The previous year was rough for the cryptocurrency space amid regulatory uncertainty and plummetion of prices. 2018 was defined by stricter oversight by regulators of the Blockchain and crypto sectors. Private and public institutional entities helped to stabilize the crypto trend, which is something that has been difficult to undertake in previous years. However, despite the stricter regulatory processes implemented by authorities, regulations can help define the path for the cryptocurrency ecosystem now and in the future. The new year will bring good things to the space including:
Futures products for digital assets already exist by means of Bitcoin contracts provided by CBOE and CME exchanges. The development of futures contracts has likely added to the decline in prices because all the futures products are settled in cash, not in Bitcoin or another virtual currency. For example, the trade volume of derivative products doesn’t directly impact Bitcoin trade volume because there’s no Bitcoin traded until the futures contracts are exercised or converted into the Bitcoin (BTC). Although they did not give the type of boost to the market many crypto enthusiasts had hoped for, futures products will shape things this year. Futures products can be double-edged swords for crypto bulls because they can give traders more liquidity.
According to Roni Berkowitz, who serves as the Head of Financial and Technological Regulation at Porat Law Firm, more crypto futures contract providers are coming. Top exchanges including Bakkt and NASDAQ are positioning themselves to launch futures contracts with new implications.
Universal Anti-Crime Laws
Several aspects of the status quo are not flexible and require a measure of compromise, which justifies the set of rules governing cryptocurrency projects no matter their goal or uses. The ability to engage in transactions on a global scale has made digital currency a very useful tool for cyber criminals and terrorists, hence the adoption of the anti-money laundering (AML) and combating the financing of terrorism (CFT) laws. The Financial Action Task Force based in Paris is another regulatory body that provides oversight in the space internationally.
Bitcoin (BTC) Price Today – BTC / USD
As of October 19, last year, all the companies in the G7 group became subject to new regulations under the FATF rules, which hopes to implement the new standards by June 2019. The United States also created similar laws half a decade ago. The Paris attacks is one reason why Europe is looking to implement laws that would curb anonymous virtual currencies.
Resolving For The ICO Issue
Resolving For The ICO Issue
The response to ICOs (initial coin offerings) has been mixed internationally. However, there isn’t a synchronized regulatory effort between countries. Hence, considering the borderless nature of the Blockchain technology, it is possible to scam a party of their crypto investment. It is essential to indicate that international regulations although strict will protect consumers. In order to ensure a seamless process when it comes to ICOs regulators are set to encourage new, compliant ICO to launches.
Although it has to be said that it will be difficult if ICO projects have to abide by the current asset classifications. Many ICOs would be labeled as securities in the current framework. Securities are strictly regulated which is why authorities are implementing new legislation for review to smoothen out things.