Cryptocurrency Market Regulation Lacks Clarity
Regulations in the cryptocurrency sector are an ongoing issue that has no end in sight. In fact, some countries delayed recognition of the sector due to uncertainty on the products’ nature. Additionally, volatility of the prices of digital assets makes the market more complicated.
There are countries that do not allow cryptocurrencies to trade in their jurisdictions. CryptoCoin reporter reveals that China imposed a ban on all cryptocurrency activities in the country. Specifically, authorities targeted initial coin offerings (ICOs). This is for the reason that projects behind many ICOs were fraudulent and manipulative.
The publication states:
“Cyberspace Administration of China has moved against 124 websites that link to crypto exchanges. The authority blocks access to crypto-related websites. The move is aimed at ensuring that the exchanges do not offer their trading services to people within the Chinese borders.”
Further, other countries like India do not recognize the currency status of cryptocurrencies. This indicates a market that might have a lot of potential but lacks a common procedure of approach. However, there are some market players that are working towards creating a regulatory environment for the market. In fact, the firms in the market want government regulators to enter the niche and see what they can do. The firms recognize that without regulations, the market will stagnate and many investors have already left the market for that very reason.
A recent report by CNBC indicates that even the government side wants sanity in the crypto market. The publication cites a letter from Congressional Members to the SEC “asking for clarity on cryptocurrency regulation.”
In part, the letter reads:
“It is important that all policy makers work toward developing clearer guidelines between those digital tokens that are securities, and those that are not, through better articulation of SEC policy.”
With this, they argue, investors will feel protected enough to put their money in the market. The legislators want to know in detail the conditions which the SEC uses to classify cryptocurrencies. They argue that lack of better regulatory articulation will drive business out the country.
According to Quad-City Times, the SEC’s articulation will boost market activity. In fact, the crypto-community all over the world wants this regulatory clarity. Luckily, there are efforts by other state and non-state players aiming at regulations. One hopes that by 2019, investors will be sure where the law stands on cryptocurrency.