Crypto Regulation: “A Good Thing For Investors”

Introduction

Cryptocurrencies are a digital or virtual currency that uses cryptography to secure its transactions and to control the creation of new units. Bitcoin, the first and most well-known cryptocurrency, was created in 2009.

Cryptocurrencies are often traded on decentralized exchanges and can also be used to purchase goods and services. While there is no official definition of a cryptocurrency, the United States Treasury has classified cryptocurrencies as property for tax purposes.

The popularity of cryptocurrencies has surged in recent years, with their value increasing exponentially. This increase in value has drawn the attention of regulators, who are now working to create regulations for the cryptocurrency market.

Regulation is a hot topic in the crypto world, with many investors feeling divided on the subject.

The very idea of various countries governments getting involved in the regulation of cryptocurrencies makes some people very nervous. They worry that regulations will stifle innovation and cripple the crypto market.

Others feel that regulation is necessary for the protection of investors. They argue that without government oversight, scammers and fraudsters will continue to take advantage of unsophisticated investors.

Regulation can also help to ensure that exchanges are solvent and have adequate customer protections in place.

While several investors, particularly those who trade with bots like plus500 and eToro are relatively irritated each time the subject of cryptocurrency regulation comes up for discussion.

Experts are of the opinion that while regulation may present a feeling of resentment, it is more beneficial for investors.

Cryptocurrency experts agree that regulation is a good thing for investors. David Drake, Founder of LDJ Capital, says “ Regulation provides a safe environment for investors as it diminishes scam opportunities .”

Anticipated Benefits of Crypto Regulation

Tally Greenberg, the director of business development at Allnodes – a platform that provides monitoring and staking services – believes that rules will have to be implemented eventually, whether or not the request is likely to remain stable in the near future.

Regulation will bring a number of benefits to the crypto economy, which include:

  • Increased trust from institutional investors
  • Improved market liquidity
  • Reduced price volatility
  • Reducing fraud and scam activities

David Siegel, CEO and founder of the Pillar Project, believes that regulation is inevitable, and it’s better to have it come from within the industry than from governments. He says, “ Regulation will legitimize cryptocurrencies in the eyes of institutional investors . This group represents the next wave of money coming into the space, and their participation is critical for sustainable growth.”

Jordan French, senior vice president at Akuna Capital, points out that with regulation comes compliance, and this is something institutional investors are looking. Tally went further to state that stability in the crypto world will cover investors, especially new investors who are learning how to trade cryptocurrencies.

Checks Against Crypto Crime

In recent times, crypto crime has grown extensively. Fraudsters made away with millions of dollars in 2017 from digital currency investors, according to Reuters. Regulation is seen as a way of stemming this tide as well.

There are a variety of more unpredictable than Bitcoin alternative cryptocurrencies in addition to Altcoins, making the crypto world more vulnerable to fraud.

Apart from increasing investor confidence in their cryptocurrency environment and providing greater stability for the whole crypto market, one other advantage of these laws is a secure crypto ecosystem.

Jerry Brito, executive director at Coin Center, believes that regulation will help make the industry more transparent and accountable. This, in turn, should lead to reduced criminal activity in the space.

Conclusion

Considering the arguments for and against crypto regulation, just as there are checks and balances in every human affair; the need for crypto regulation cannot just be set aside.

Also in view of the increased crypto and scammers crime rate, it’s essential that regulations must be put in place to make the crypto ecosystem a safer market for dealers and investors likewise.

Related

en_GBEnglish