Aside from turning small investments into millions, the Bitcoin boom of 2017 ushered in a newfound respect for crypto technology. With big businesses forced to take note of the sector’s popularity, more companies are now exploring the possibilities of blockchains. However, beyond the technical innovations that are bound to arise from this side of the industry, those monitoring the markets can’t forget the financial aspect of cryptos. When Bitcoin went live in 2009, one of the underlying aims was to create a universal monetary system that removed the need for a central authority. With many still pushing for cryptocurrencies to become a dominant payment method, the political powers that be are looking at ways to oversee things.
Protection is Patchy at the Moment
At this point, the regulatory landscape could be described as piecemeal at best. With countries, states and individuals all taking a different stance on cryptocurrencies, exchanges and initial coin offerings (ICOs), now there are blanket rules covering the industry. With plenty of gaps to fill, the state of Florida has moved to plug its own crypto leaks. Announced in June 2018, the state is poised to appoint a so-called “cryptocurrency czar” to protect consumers.
“We cannot allow the cryptocurrency industry to expand in Florida unfettered and unchecked with the potential for so many, including our large population of seniors, to be exploited,” said Florida’s Chief Financial Officer Jimmy Patronis.
Following a similar move by the U.S. Securities and Exchange Commission, the state will now try to curb the potential for scam artists. Because the market is still in an embryonic state, those with bad intentions have a myriad of ways to exploit the uneducated. For Patronis, this is something a tech expert can address in both an advisory role and through direct action. In fact, it’s this type of oversight that’s now becoming common in all areas of the industry. As more people start to trade cryptocurrencies on broker sites like eToro, consumers are being afforded more protections. By integrating cryptos with traditional assets such as foreign exchange, commodities and stocks, operators are naturally bringing them under the umbrella of classic financial regulations.
Crypto Regulation is on the Horizon
In line with this, blockchain investment bank NKB explored the potential of crypto coin Cardano using a financial framework. By applying established financial regulations to the emerging technology, the bank was not only showing the potential of Cardano but the potential of controlling the market. While there is clearly a lot of work to do, the seeds have already been planted. Given the unprecedented rise of Bitcoin and its peers in 2017, the powers that be are now scrambling to react. Creating a one-size-fits-all set of rules and regulations for technology predicated on universality, anonymity and decentralization, won’t be easy. However, if politicians, exchanges and experts can lay the foundations, building a fortress around what’s clearly a valuable technology is possible. Although it may take a decade to fully form, changes are on their way. For consumers and industry insiders alike, this is perhaps the best sign yet that crypto technology is here to stay.