Rules are essential in this world. Try to imagine living without laws and regulations. Every person would do whatever they wanted, and there would be consequences for their actions. Lawlessness and disorder are oppressive since only a few will benefit from such a system.
Although our ancestors lived without a governance structure, we can look back to the times and agree that humanity was not residing in perfect harmony. Nowadays, there is harmony between regions because of rules and regulations. A code of conduct to adhere to offers acceptable standards to society and provides the right environment for development. It would be difficult for communities to live in peace if there were no rules to follow. People would fight over resources, which is why we need regulations to coexist with others.
Besides rules setting the basis on the right and wrong things to do, it is necessary for safety. Whether it is a product or service industry, there is a regulation of some sort. The extent government sets the legislation willl depend on the amount of risk. You will find more laws to govern particular industries like food, health, education, and transport than in other sectors. Failure to take the necessary steps will put the public at risk of substandard services and unsafe products.
Still, untrained and unskilled people would pose as professionals taking advantage of unsuspecting consumers. In the example of the health and food sectors, unregulated products would cause devastating effects, including death. So, enacting the laws to regulate the sectors is a good thing and positively impacts the industry. Any sector must undergo a phase where stakeholders and governments develop strategies to control their operations. In turn, it leads to industry evolution and stabilization.
There are mixed opinions on whether there should be a form of regulation for the crypto industry. Since its introduction, it remains unregulated and offers loopholes for fraudulent people to explore. Some stakeholders say that regulating the sector will go against the spirit of digital currencies establishment: The parties would prefer things remain the same.
On the other hand, others think it would be the right move for the consumer even though it may slow down the sector’s development. Despite the calls to make the industry independent and inaccessible by government agencies, it should not be an excuse for fraudulent activities. Already there are suspicions of cartels and dishonest business people using the platform to launder.
They take advantage of the sector since there is no regulation. Viktar Prakapenya’s view is that the cryptocurrency industry needs to be regulated and believes it would be best to consider the positive impact of the move on the industry. It will provide a suitable platform for every investor to profit from the industry and eliminate fraudulent individuals in the market.
Although cryptocurrency has existed for several years, people are sceptic about its future impact on the world. The industry has stalled for some time now, and it is mainly because it is unregulated. It would be impossible for the digital currency to develop further if there is no regulation in the industry.
For example, several countries banned Binance, a cryptocurrency trading platform in their jurisdiction, due to money laundering and tax fraud claims. It would be best for stakeholders to embrace change in the form of industry regulation. Without setting the rules for service providers to follow, the sector will not integrate or compete with other financial instruments.
If unregulated, cryptocurrency will remain in the shadows of financial instruments regulated institutions offer. The view that not having government regulations is necessary to maintain crypto freedom is inaccurate. On the contrary, rules will enforce it, and we can see from the example of tech industries regarding data privacy.
The companies would source and use user information without their consent, and a need to regulate the sector arose. Brands would choose what to do when there was no regulation and standard operating procedures. It necessitated strict laws and penalties for companies who would contravene the laws on data protection.
The legislation would have been lenient if the industry players had done the right thing. Now tech companies do not have an option but to comply with the law. Therefore, it is in the cryptocurrency industry’s stakeholders’ best interest to work with regulating authorities to enhance the freedom they envision in the sector.
The assumption by cryptocurrency industry players that the sector can remain unregulated will be their undoing. It would be impossible for the industry to grow further, affecting its workers, partners, and users. Since governments will ultimately make efforts to regulate any industry, things will likely be different in the future for crypto service providers.
Rather than waiting for the time that it will happen, it would be best for brands to take the lead in initiating the process. Pioneers are the most adamant about industry regulation and are the ones to suffer the most when it happens. Viktar Prakapenya advises the industry players to be at the forefront of protecting their operations by working with the regulator. With an expert’s view on the matter, there will likely be problems with the legislation set to regulate the industry. Some of the recommendations the regulators set forth will probably be controversial, but it will be mandatory to comply.
It is not a new phenomenon to have an unregulated industry. During the internet’s introduction to the world, not many countries had legislation to regulate its use. Nowadays, you can find internet use laws in most countries worldwide. The cryptocurrency industry will experience a similar thing regardless of the resistance to its regulation.
It would be best for the relevant players to spearhead the process as it will ensure the laws consider every stakeholder’s needs. Legislators will pass an unfavorable statute for crypto industry businesses without the correct information. But, discussions with lawmakers and government authorities are the best option. All stakeholders participating in crypto mining and processing should contribute to the regulations.
Although cryptocurrency is unregulated across Europe, countries are taking steps to enact regulation laws on the sector. There is currently a proposal for the European legislators to consider how to protect crypto assets, which will change how the industry operates.
It is the stakeholder’s mandate and in their best interests to help the parliament develop the best law on the crypto market. It will be part of the European digital finance strategy. The initiative will streamline the sector and eliminate those undertaking illegal activities via the platform.
Researchers and other global organizations interested in cryptocurrency are helping service providers with the correct information about the industry regulation. Due to the merging of technology and finance, FinTech stakeholders are playing a role in educating the relevant parties. The entities see the industry’s potential and the ideal regulatory framework. They believe that there needs to be trust between all players if the rules are to bear results and promote market growth. It will determine if the stakeholders comply and adopt them in their operations. Still, it is necessary to take a holistic approach to the regulatory framework and consider the impact of crypto mining on the environment. Including the requirement to use sustainable techniques in the process will help protect the environment for future generations.
Even though crypto pioneers are innovators and do not like working under rules, the prospect of cryptocurrency regulation should not be threatening. Those afraid of the change may worry about their future profits if the government regulates the sector. Remember that fear can hinder growth. Legislators do not gear towards hurting businesses but creating the best environment for all players. Furthermore, the government is not against financial gain as they understand cryptocurrency’s impact on the finance sector.
According to Viktar Prakapenia, the ideal regulatory framework should aid investments and promote industry growth. It will stabilize the cryptocurrency market and protect investors’ assets. Therefore, industry regulation is not bad as it eliminates manipulation from external entities. On the contrary, it increases the public’s confidence in the digital currency and promotes industry growth.
About Viktar Prakapenya
Viktar Prakapenya is the founder of VP Capital, an investment firm focusing on FinTech and Blockchain companies. The entrepreneur has developed successful software companies and sold them.
Viktar Prakapenya has been instrumental in developing innovative and cutting-edge technology. His expertise traverses across different fields like business, Information Technology, and Law.
Credit: Source link