Mintme News


Cryptocurrency regulations: the good and bad

Jul 7, 2022

          It is part of the fame of cryptos that regulations have always been minimal. Even when a government has wanted to have more control over them, it only ends up generating longer and more complicated processes for the trading platforms, but at least for those who can create their own nodes or for those who work in private networks, such regulations have no effect.  

It is interesting to think that going to a bank we could find numerous obstacles to formalize an account, incessant paperwork, requirements, recommendations, waiting times... However, to be part of the cryptoassets movement it doesn't take much more than a device connected to the internet. 

As nice as it sounds to put it that way, there are indeed regulations for cryptos today and there are increasing attempts by governments to control the movement of cryptocurrencies. Earlier this year the President of the United States of America, Joe Biden signed an executive order that seeks to oversee and outline policies on digital assets, and also to evaluate the possible creation of a digital currency of its own. While this executive order does not introduce new regulations or provide regulatory agencies with the administration's position on what regulations, specifically, they should adopt, it does hint at the growing interest and concern of government agencies. 
Slowly but surely different governments at different paces have been trying to bring some "order" to the cryptoassets sphere, either to encourage and make cryptocurrencies safer and scam-free, or to completely discourage and ban the application of cryptocurrency in all its forms. 

Cryptocurrencies as an alternative 

Such is the case of countries in crisis such as Russia, Venezuela and Argentina, which have resorted to the use of cryptocurrencies as an escape from the financial crisis, weak fiat currency, and economic sanctions. And while there is a tendency to view them as an escape from just sanctions there is also the case of Ukraine and how many have come out ahead due to the irregular movement of cryptocurrencies. 

So for a long time the minimal regulations have been a real attraction for very positive reasons. People who previously couldn't have a bank account or send money to their relatives abroad made it thanks to exchange platforms, large contracts or significant purchases were achieved in a couple of hours without having to go through the overblown scrutiny of a banking institution, artists and content creators sold their exclusive art directly without seeking the backing of managers, financial advisors and lawyers. 

However, not everything about regulations is bad. In fact, regulatory agencies actually have the best of intentions. Created to protect consumers from the risk of dangerous and predatory financial situations. Some intend to couple the practical freedom of cryptocurrency use with standard security rules to prevent, for example, money laundering, embezzlement, financing illegal activities, or even something simpler like preventing you from buying from or selling to a person with a fake name or business name. 

So it only remains to work on devising solutions that mitigate the exaggerated and increasingly complex regulatory standards that government agencies are implementing, while at the same time generating secure and simple membership processes to offer more transparency and security in general, without taking away from cryptocurrencies this deeply rooted characteristic. 

Mary Schwartz