[ad_1]
Just this week, the ether (ETH) Broke the $4,000 mark And Bitcoin (Bitcoin), the most popular cryptocurrency in the world recently Reached an all-time high More than $63,000. At the same time, Dogecoin (Dog) In “Father Dodge” Elon Musk (Elon Musk) Appeared on Saturday Night Live News about digital art works getting amazing prices in the form of irreplaceable tokens is everywhere.
Whether you like it or not, cryptocurrencies are very popular.
However, not everyone believes it.The newly formed U.S. Treasury Secretary Janet Yellen (Janet Yellen) previously Question legality and stability Cryptocurrency as a store of value. After all, only three years ago did we see the last Bitcoin bubble burst. After skyrocketing in 2017, BTC Reached the 20,000 USD mark, The sell-off in 2018 paralyzed the asset and attracted comparisons with “tulip mania”.
related: Will Bitcoin prove itself a reliable store of value in 2020?Expert answers
Bitcoiners are called “believer“Because of their enthusiastic support for this new volatile and arcane technology. But please don’t be confused: it is not just technology enthusiasts and weird billionaires like Elon Musk who are committed to cryptocurrency. From JPMorgan Chase to PayPal , The real Wall Street figures and Silicon Valley fans buy Bitcoin to a large extent.
related: Does PayPal’s encryption integration bring encryption technology to the masses?Expert answers
Bitcoins in circulation are now worth more than one trillion U.S. dollars.Most major financial institutions-including investment giants and payment companies-now support this cryptocurrency and have Growing interest from retail investors. Bitcoin is becoming an increasingly important part of the global financial system.
At the same time, because different governing bodies have woven a series of cryptocurrency rules in the past ten years, Bitcoin still exists in a regulatory gray area. In many cases, this patchwork method is not enough to make mainstream investors full of confidence in the market, because some of the most basic principles of cryptocurrency governance remain to be debated. For example, are cryptocurrencies considered assets or securities? Well, it all depends on who you ask…
What do investors need to know about cryptocurrency regulations?
One of the major misconceptions about Bitcoin (usually a cryptocurrency) is that the market is a kind of “wild west”: beyond the reach of regulators, it is full of crooks, lawbreakers and crooks. That’s not true at all.
Any business related to consumers in the United States and other jurisdictions must comply with some form of regulatory standards and rules, and this also applies to digital assets. Assuming we are at the forefront of a new, disruptive technology, there may not be a framework that takes cryptocurrency into account. But various rules regarding consumer protection, money laundering prevention, anti-fraud and other areas apply to different activities that occur. Encryption companies can work with law firms to interpret the rules related to their business and do their best to comply with these rules.
In the past decade, as regulations have caught up with innovation, the current set of cryptographic rules has been pieced together.But this may soon change: confirmation of Gary Gensler -Former head of the Commodity Futures Trading Commission (CFTC), who taught courses on blockchain technology and cryptocurrency at the Massachusetts Institute of Technology- New Chairman of the Securities and Exchange CommissionThe US Securities and Exchange Commission (SEC) stated that the current government will take digital assets seriously and try to provide comprehensive supervision and regulatory guidance for this emerging market.
Gensler has close Before formulating the digital currency regulatory agenda, he is waiting for Yellen’s review of cryptocurrencies to be completed. At the same time, Congress is seriously considering it.Last month, Members of Parliament Bring in A bill aimed at establishing a working group of industry experts and representatives of the SEC and CFTC to evaluate the current legal and regulatory framework surrounding digital assets.
related: Crypto-friendly faces ready to take up positions in Biden’s administration
It is difficult to predict what we will see in the near future in terms of cryptocurrency regulations and various business models in the industry. Nonetheless, we find that regulators are becoming more and more complex and constructive because they recognize that regulators have a responsibility to actively protect consumers, promote innovation and create a positive economic environment.
How can institutional investors trust cryptocurrency companies?
In recent years, with the emergence of numerous encryption companies, under this confusing regulatory background, it is important for institutional investors to understand the pitfalls that should be avoided when choosing partners to entrust their digital assets. To understand how a company is regulated, information should be made public on its website and verified on the regulator’s website.
In addition, it is worth knowing about each business model, because not all companies are the same. The basic concept of payment income may be the same, but the risk profile may be quite different. If a company is not transparent in how it operates and generates revenue, it should cause concern, and if their interest rates are very different from those of their competitors, I think it’s important to understand why. Be sure to read the rules!
Some companies may choose to work in a jurisdiction known for light regulation, but evading regulation will come at the cost of building trust and long-term business. Any company worthy of cooperation will maintain a position of active cooperation with regulatory agencies. This is a complex environment that may be expensive for startups, but it is part of establishing long-term value.
Cryptocurrency lenders who want to be at the forefront of the digital revolution need to accept the upcoming regulatory reforms and welcome dialogue with regulators. Investors should seek partnerships with companies that value transparency, compliance, expertise and fairness.
This article does not contain investment advice or recommendations. Every investment and trading action involves risks, and readers should conduct their own research when making a decision.
The views, thoughts and opinions expressed in this article are only the personal views of the author, and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Camilla Churcher He is the global head of Celsius’ network business development. Camilla has extensive experience in traditional financial services, Wall Street companies and fintech startups. After earning a master’s degree from the University of Edinburgh, Camilla began her career in finance, initially as an analyst at Morgan Stanley and later as an analyst at Citigroup. Most notably, Camilla served as Credit Suisse’s chief derivatives services director, and later became the chief brokerage sales director of Bank of America. Before joining Celsius, her most recent position was as the head of sales for LGO, an institutional digital asset exchange.
[ad_2]
Source link
