Regulations within the crypto world are a contentious issue. After all, how can you regulate something when you can’t agree on what it is? Then there’s the obvious challenge of getting governments and other financial entities across multiple jurisdictions to agree upon a single issue. There are also fears that cracking down on cryptocurrencies will quash innovation and impose centralization, detracting from the key selling point of blockchain tech itself.
But, just like a colonoscopy procedure over the age of 50, regulations, are a necessary evil.
Lawmakers are Mobilizing Globally
Uniform crypto regulations have been slow to get off the ground, but moves are currently being made to encourage the same. In the US, Japan, South Korea, and the EU, financial governing bodies are coming together to encourage blockchain adoption as well as to promote the use of digital currencies in a way that does not pose an economic threat to investors.
A central problem that persists within the crypto sector is that of the bottom-feeders who prey on innocent investors as well as launder money and avoid paying taxes. One of the first places where corrections need to be made is within the domain of cryptocurrency exchanges. In recent weeks, South Korea’s Financial Supervisory Service (FSS) has indicated that nation’s government is working on plans for self-regulation. FINMA (the Swiss Financial Market Supervisory Authority) is also beginning to follow the US’ lead and is now treating some cryptocurrencies as securities.
The European Union also announced last week that they will henceforth follow tighter cryptocurrency regulations. The EU parliament voted by a sweeping majority to honor the December 2017 agreement they made with the European Council to clamp down on the use of cryptocurrency, mainly for financing terrorism and laundering money.
But with a majority of altcoins still on the upswing, the threat of regulation hasn’t sent anyone into a tailspin just yet. Perhaps that’s because regulation will be a good thing, after all. The Winklevoss twins have certainly given that impression after recently announcing their partnership with Nasdaq last week. They have hired the financial juggernaut to help them monitor Gemini, their cryptocurrency exchange.
With the crypto climate slowly changing and tighter regulations now just around the corner, those who are prepared for them will most likely come out on top as the altcoin market is slowly but surely adjusting to having more eyes on it.