Nansen CEO Alex Svanevik is confident there will be a protocol in the future that creates a balance between both and is compliant with regulators.
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Blockchain transparency and privacy are a delicate balance, says Nansen CEO, Alex Svanevik. He believes that in the evolving landscape of blockchain, there’s a growing comfort with asset and ownership information being publicly accessible. Svanevik acknowledges that achieving both absolute transparency and complete privacy is unattainable. While transparency is desired for corporate entities and exchanges, individuals still expect a degree of privacy.
Svanevik argues that extremes on either end are unlikely to gain widespread acceptance. Full privacy would compromise the transparency expected from corporate counterparts, and being fully transparent is an uncommon stance as individuals typically value some level of privacy. This balance also has generational aspects, with younger generations being more open to sharing their lives online.
The CEO predicts that as younger generations, accustomed to sharing on social media, grow older, the world may become more comfortable with asset transparency. He suggests that people might even showcase their ownership of NFTs and cryptocurrencies on social media in the future.
To resolve the trade-off between privacy and transparency, Svanevik believes projects need to provide settings that allow users to choose between the two spectrums based on circumstances. Furthermore, regulatory considerations come into play, with concerns that some regulators might not accept total privacy for large asset transfers. However, smaller transactions may be more acceptable.
While no protocol currently strikes the perfect balance, Svanevik anticipates that in the coming years, someone will develop a solution that meets both privacy and transparency needs while aligning with regulatory standards.