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A Look at Global Crypto Regulation

Investors are not the only ones taking a much closer look at cryptocurrency markets since 2017. Lawmakers across sovereign states have also been getting involved. The outlook and tone of messaging is scattered across the spectrum with some governments welcoming innovation while some shunning anything related to cryptocurrencies.

The vast majority have, however, been constructive. The Indian Government, for instance, recently sent out officials from the apex financial regulatory agency SEBI on a fact finding mission across the world to understand how to approach crypto regulation.

States that are very keenly supporting regulation include Malta, Singapore, Gibraltar and Switzerland. In addition to actively supporting cryptocurrencies, these jurisdictions are at the forefront of pushing the crypto regulatory envelope constructively. They have been very proactive in passing progressive legislation around use cases and adoption. On the other end of the spectrum are countries such as China and Saudi Arabia which have outright banned the use or promotion of any kind of cryptocurrencies or products including facilitators such as exchanges. Meanwhile, somewhere in the middle are countries which have taken a more mixed approach such as India where the purchase of cryptocurrencies using the banking system is currently prohibited while regulations are being finalized.

Lawmakers will need to find a fine balance between protecting the interests of investors and driving innovation, and the task of regulating a rapidly changing, emerging industry is not being helped by the turbulent cryptocurrency markets, which is just one facet of the industry, and the most visible one at that.

Meanwhile in Crypto Wonderland….

“Some Clarity Please” A group of 5 Republican lawmakers wrote a letter earlier this week to the IRS expressing concern over the tax authority expanding its enforcement activities without offering any clarification on the tax framework used for cryptocurrencies. The IRS has been mostly silent on the cryptocurrency market with its current guidance on cryptocurrencies dating back all the way to 2014.

“Rock Bottom” Speaking at Yahoo Finance’s All Markets Sumiit, Michael Novogratz, a global macro hedge fund manager and ex-Goldman Sachs partner, suggested that cryptocurrency markets have bottomed out and should now start rebounding, especially Bitcoin. He blamed the 2016-17 volatile run on “classic speculative global mania”and now expects institutions to start investing.

“Tether But For AUD” Following on the footsteps of the recent frenzy of new stablecoins, there is now talk of developing a stablecoin (pegged to the Australian Dollar) by Emparta and Bit Trade. Stablecoins offer a low volatility medium of exchange for cryptocurrencies but have been controversial in the past with some sceptics suggesting that firms such as Tether may not be actually holding the underlying asset (USD).

“New Privacy Focused Superfast Crypto” David Chaum, one of the cryptocurrency space’s first and leading evangelists and the founder of Ecash, is now launching a new cryptocurrency Elixxir. Elixxir is designed to be a privacy focusd cryptocurrency that is over “a thousand times faster” than any other blockchain by using two blockchain breakthrough that the cryptographer claims he has made recently.

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