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May 04 2022
Will The U.S. Soon Regulate Crypto? Comments (0)

The cryptocurrency market cap tops $1.7 trillion, and such a big market could create severe disturbances in financial markets. The daily turnaround in crypto markets is over $90 billion. From the government's perspective, digital currencies are unregulated, and there is no central bank or other authority to monitor what is going on with crypto.

Blockchain technology is decentralized, the unregulated ledger is hard to regulate, but many investors seek more rules in the crypto arena. Blockchain and other digital tokens have high volatility, and you can win or lose substantial amounts in a day.


What is cryptocurrency?

Digital currency is secured by cryptography and built on blockchain technology. It uses a decentralized system to record transactions. Blockchain utilizes a peer-to-peer system to receive and send payments without centralized authority or overseer.

You can store digital coins in digital wallets, and each transaction uses encryption and is highly secure.

Anonymity and security are two benefits of cryptocurrency. Governments have trouble dealing with such different payment methods, but some other parties welcome crypto.

iGaming and crypto

iGaming websites are usually at the forefront of new technology, which applies to crypto coins. Some websites use secure blockchain technology to store sensitive data, while others accept crypto payments despite being unregulated.

It is not explicitly prohibited in the US, nor is it allowed. So if you want to visit gaming platforms, you can try out new PayPal casino sites. In addition, PayPal deals with crypto, so you can use it as a middleman to play casino games.

Another blockchain use case making its way into the mainstream is NFTs. Non Fungible Tokens are the way to sell digital assets with ownership certification recorded on a blockchain.

The state of crypto affairs

The number of different cryptocurrencies changes daily because they are relatively easy to create. But, like with well-established money, the people give them value. Most of the $90+ billion traded daily goes to the two most prominent names in the cryptocurrency world, Bitcoin and Ethereum.

There are more than 18,000 digital coins traded in over 460 cryptocurrency exchanges outside those two. The Crypto market is too big for the government to ignore it. If you regulate the market poorly, it can bring significant consequences to the economy because of its sheer size.

The World Economic Forum reports there is no international coordination or regulation of cryptocurrency. However, most financial and government bodies are researching the risks of the crypto market.

Bitcoin and other digital tokens have a unique feature of being used as a currency in transactions, but at the same time are traded more like an asset and considered for investments. Some people use crypto markets as a hobby similar to binge watching.

What will the US do with cryptocurrency?

The change began when President Joe Biden signed an executive order about cryptocurrency. It is the maiden step in an attempt to regulate the trading of crypto coins. Under the order, there are instructions for government bodies. The Treasury Department should develop policies and regulations on digital currency, and the laws should be in line with other partner countries. At all times, the special counsel should monitor the stability of the US financial system.

The US has significant concerns about cryptocurrency's influence on protecting consumers, financial markets, and national security.

The United States is not the only country researching digital currencies and potentially connecting them with the central bank. However, because of the enormous growth of the crypto market, you can't ignore it, and it is better to keep technological leadership.

Will crypto get legislative regulation?

The US government made its first moves with the presidential executive order, and critical steps are enabling cross-agency cooperation. However, trying to legislate crypto locally won't be enough because of its decentralized nature. Instead, there should be a joint effort between the countries so that global financial markets know what to expect from cryptocurrency.

For now, it is an untamed area, where billions of dollars are traded each day without any oversight of central authorities. However, since the lack of regulatory bodies and the decentralized nature of crypto are its main advantages, a fair question is will the market shrink if it becomes more regulated.

Some investors in digital coins appreciate the system's anonymity, and despite the volatile nature and huge swings in value, they stick with cryptocurrency. The market, as now constructed, is also inviting for people from the wrong side of the law. They can invest their illegal money into cryptocurrency and stay anonymous.

The US will regulate cryptocurrencies, but the process will take a while. What will that regulation look like? It remains to be seen. There is an option for central banks to issue digital currency, and for the other approach, we will have to wait for what joint government bodies will propose.