David Weild IV, former vice chairman of Nasdaq and one of the leading figures in the U.S. in IPO and stock market analysis, doesn't think the crypto market is collapsing. Instead, he said to BLOCKTV's Yael Lavie in a special interview, the current fluctuations in the market should be used to clean it up from misconceptions, fraud, and "cowboyism." Weild, who was one of the instrumental forces behind the 2011 Jobs Act in the U.S., will be a keynote speaker at the upcoming Next Block conference that will be held in Tel Aviv next week.
Weild explains that after the massive bull run, there has to be a correction. While the stock markets took a hit from the developing so-called trade war between China and the U.S., the crypto markets suffered from a lot of misrepresentation and fraud, as well as concerns over a possible response by regulators. However, Weild sees that as a "pretty healthy" cleanup process that should basically reset the markets in approximately six months.
"I think that the kind of almost libertarian or anarchist view of highly decentralized systems that are immutable and can’t be changed – I think is an interesting and very sexy idea to some, who are libertarians, but I think that it’s probably less commercial."
With regard to ICOs, Weild says, "They deserve to be dead," claiming that most ICOs were in fact security offerings and as such did not meet the criteria of inspiring trust in investors with weak white papers that lacked disclosure on the most basic level. This echoes a statement by SEC chief Jay Clayton, who claimed that ICOs were in fact securities. Weild warns against market "cowboyism," which would damage investor confidence.
David Weild IV. "There are things that don’t need to be radically decentralized, especially in financial services." Daniel Acker/Bloomberg via Getty Images.
The road to crypto institutionalization is not going to be short, says Weild. It takes a gradual educational process for investors to become more comfortable. The idea of highly decentralized systems may appear sexy to libertarians or anarchists, but Weild estimates that it's not commercial enough: "There are things that don’t need to be radically decentralized, especially in financial services."
"I would pick high quality management teams, well capitalized situations and make sure that they’re going through the front door in terms of regulation."
Asked how to pick a right investment in the crypto market, Weild points out three decisive factors: First and foremost, the quality of the product's management team. After that come the product's capitalization and the adherence to basic regulatory principles.
Mr. Weild will take part in the Next Block Conference that will be held in Tel Aviv next week under the title, "From Chaos to Clarity: 2019 Trends." Watch the full interview with Weild here.