Should Cryptocurrencies Be Regulated?
Cryptocurrencies became popular around 2017. So many people were interested in the first cryptocurrency called bitcoin. There is also another network called Ethereum, and it uses Ether as its transaction token. Free spiny za rejestracje in some online casinos are already given for deposits in bitcoins as a part of the process of adopting the trend.
How It Works
Unlike traditional payment networks that rely on cash transactions and a central intermediary, cryptocurrency does not. There is no intermediary to receive funds from person A and then pass them to person B. No cash is involved in cryptocurrency transactions. Transactions are solely electronic and are confirmed by miners. Another important feature of cryptocurrencies is the blockchain public ledger. This ledger has every transaction made in a cryptocurrency, so it has blocks of data. A miner duly validates each block of transactions. After validation, no one can alter the ledger, and it remains accessible to all users of cryptocurrencies. Due to full reliance on a digital token like Bitcoin or Ether to do online transactions and pay miners, most people think that cryptocurrencies need regulation.
So far, cryptocurrency networks are mostly free of government regulation. Bitcoin being the original cashless network has been irresistible to those who want to get rich overnight. There has been a case of hackers who broke into the South Korean crypto market and stole some bitcoin. Even without hackers, cryptocurrencies would be suspicious. Vast sums of money have been transacted electronically and anonymously before without leaving a trail for investigators to use. One thing that has made it difficult for governments to regulate cryptocurrencies is the scarce information about them.
They are not sure whether these digital currencies are a commodity or security. It is not clear whether these should be regulated under the Securities and Exchange Commission jurisdiction or the Commodity Futures Trading Commission jurisdiction. Different governments are starting to act, though. For instance, China does not want its citizens to use cryptocurrencies as a source of capital for new businesses. In the US, the federal government is not so sure of what to do. Some states are looking into ways to prevent fraud that could arise from trading with cryptocurrencies. Other states see cryptocurrency as an emerging market that could potentially grow and benefit the economy.
Benefits of Regulation
If this mode of payment is fully regulated, the following benefits can occur.
- It will be easier to isolate genuine bitcoins from those sullied by crimes like money laundering and terrorism. Origins of cryptocurrencies will now be associated with a particular person. With compliance systems in place, those who do not want to expose their identities due to shady deals will flee.
- Presently, policymakers don’t know what digital cryptocurrency is or how to classify it. After drafting and enforcing rules and regulations, there will be a clear category and classification for these virtual assets. It will be easier to know if you own a commodity or security.
- Traditional financial institutions, such as banks, will boldly and fearfully promote cryptocurrencies. These institutions are not sure what these digital tokens are and can’t risk promoting something that could, later on, be tied to fraudulent or terrorist activities. After government regulation and classification of these virtual assets, banks will feel safer and might grab the chance to use them as a payment mode and withdrawal.
- Laws will help change cryptocurrencies from just speculative to functional virtual assets. Large companies will courageously implement cryptocurrencies into their daily operations. It is because cryptocurrencies will now be deemed as acceptable and genuine assets to trade with. They will receive no more criticism or condemnation from offering cryptocurrencies and might receive immense support from the general public, especially the millennial generation.
Regulating the cryptocurrency industry might be beneficial to all users and governments across the world.
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