Calls for global regulation of the crypto market have been growing lately, especially against the recent $60bn Terra Stablecoin crash.
Today, we will figure out what sentiments are hovering among the world’s largest economies and who, how, and when can offer fundamental tools to control the crypto market. Spoiler alert: there is no unanimity on this issue.
Thus, the European Central Bank president, Christine Lagarde, radically stated in an interview with a Dutch TV channel that cryptocurrencies are “based on nothing at all” and the market requires immediate and all-pervasive regulation to avoid further speculation.
“My very humble assessment is that it is worthless. Cryptocurrency has no basis, no underlying assets to serve as an anchor of security,” Lagarde said.
Her colleague, ECB Executive Board member Fabio Panetta also spread the word that regulators must have a unified, coordinated approach in the digital asset market, which can now be called the “new Wild West.”
“We have to make faster progress to ensure that crypto-assets don’t trigger a lawless risk frenzy. Panetta said that transparent rules are necessary to combat money laundering and counter global financial terrorism,” Panetta said.
Some significant US officials are not so skeptical and consider the current fluctuations in the crypto market, though unfortunate, to be by no means panicky. However, these statements have obvious political overtones and are intended more for the domestic voter.
For example, several senators and regulators said on the sidelines of the recent DC Blockchain summit that the side effects of the Terra fall are confidently contained, and crypto investors have no reason to worry.
“We don’t want to stifle a new industry and innovation. These are missed opportunities that are moving overseas. We are missing out on our economic growth and job creation. So there have to rule in this game that makes it more predictable, transparent, where there are necessary consumer protections,” said Senator Cory Booker of New Jersey.
In addition to the US pragmatic view and the Old World’s more conservative approach to regulating the crypto market, countries in Asia also perceive the issue differently.
For example, China has straightforwardly solved the market regulation issue. In the fall of 2021, the Chinese government altogether banned activities with digital assets in China. No market, no problem. For some players, this situation has been a stabilizing factor. According to Jack McDonald, CEO of Standard Custody and Trust, such a move by the Chinese authorities is “a good thing for cryptocurrency confidence.”
“It was moving like this that inspired the creator of bitcoin as an alternative to state-owned and controlled fiat currencies. China has always had strict controls over the capital of its citizens, so it makes sense that they banned cryptocurrency. This is another level of control,” McDonald commented. Note that at the moment, DPRK is still the world leader in the bitcoin hash rate.
An exciting story about Singapore. After all, Singapore was the headquarters of Terraform Labs, the company behind the infamous Terra protocol. Because of the stabelcoin collapse, Singapore authorities have announced upcoming raids with tax and legal audits of all foreign offices linked to digital assets. Singapore authorities fear that the Terra precedent could negatively affect the country’s business reputation and are actively pursuing a global regulatory initiative.
Today, there is no global consolidation of all economies to regulate the crypto market. Instead, there is a pronounced regional factor and national interests. One thing is sure, the issue of regulation is overdue, and the need for crypto-enthusiasts will soon divide into two camps: some will see the problems, and others – the opportunities.
The team of MINE.exchange prepared the material. MINE.exchange, is the best e-currency exchange service. Everything is changing for the better!
