Christopher Perkins, president of CoinFund, has issued a disapproval of the Bank for International Settlements’ (BIS) recent paper on crypto.

Perkins called its recommendations “completely uninformed and frankly, dangerous.” The BIS report, titled “Cryptocurrencies and decentralized finance: functions and financial stability implications,” acknowledges cryptocurrency’s growing importance with the rise of ETFs, stablecoins, and tokenized assets. However, Perkins strongly objects to the paper’s containment approach to cryptocurrency regulation.

“Guys, crypto is not communism. It’s the new internet that provides anyone with access to financial services,” Perkins stated. He rejected the comparison to Cold War containment strategies. “You cannot control it anymore than you control the internet.”

Perkins warns of liquidity risks if crypto is separated

Perkins had witnessed the 2008 financial crisis firsthand as a trader at Lehman Brothers during its collapse. With that experience, he warns that artificially separating traditional finance from cryptocurrency markets could create liquidity risks. Perkins argues that forcing a division between the 24/7 settlement capability of crypto markets and the time-restricted traditional system would “lead to the next systemic crisis.”

Instead of containment, Perkins advocates for modernizing traditional financial systems to integrate with blockchain technology. “Capital rules should not ‘contain’ public blockchains—they should encourage them!” he argued. He suggested that regulation should focus on updating legacy systems rather than isolating new technology.

The CoinFund president also challenged several other conclusions in the BIS report. He particularly focused on its concerns about information asymmetries in decentralized finance (DeFi).

Perkins questioned the BIS’s criticism regarding anonymous developers in DeFi projects. He also noted that traditional financial institutions typically do not publish lists of their developers.

Perkins also took issue with the BIS’s worry that stablecoins would cause macroeconomic instability in nations like Zimbabwe and Venezuela. “If there is demand for USD stablecoins and it helps improve the condition of anyone in the developing world, perhaps that is a good thing?!” he wrote. He also added that people worldwide deserve access to basic financial services regardless of their country’s monetary stability.