u.today
Former Barclays CEO Bob Diamond has thrown his weight behind the long-debated Clarity Act.
During his recent appearance on CNBC's "Squawk Box," he stated that the legislation would actually benefit the banking industry.
Banks stand to benefit
The Clarity Act, which aims to establish a comprehensive regulatory framework for digital assets in the United States, has recently stalled in the Senate due to various disagreements, with the banking industry mostly rallying to oppose the bill.
Asked whether banks were right to oppose the legislation, Diamond argued that the opposite is true, given that the bill is "really good for the banks over time."
He noted that the world's largest financial institutions are already preparing for blockchain-based finance, arguing that "no one is investing more in innovation right now than JPMorgan, Morgan Stanley, Goldman Sachs, [and] Bank of New York." As a result, Diamond believes "the large, most successful banks are going to benefit from this."
Advantages of blockchain
Diamond described blockchain technology as a transformational improvement to financial markets, stressing that "what we're talking about is innovation."
He pointed to several advantages of blockchain infrastructure, including "24-hour trading, 24 over 7," as well as "instantaneous settlement, which is a positive thing." He also praised blockchain's transparency, noting that it creates "a permanent record in perpetuity of every transaction that happens."
According to Diamond, these features can significantly improve the efficiency of financial markets, delivering services "at a fraction of the cost with deeper liquidity." Taken together, he argued, "these things are very, very positive."
Regulatory Clarity could accelerate adoption
Diamond said banks are already investing heavily in the infrastructure needed for tokenized finance and suggested that regulatory certainty would only strengthen that trend.
"The investments that are being made by the banks," he said, mean that "a number of the banks that have been investing will be big winners in this."