Crypto regulation is the best thing that can happen to the stock market


 

 

 

 

 

 

  • Consumer protection
  • Increased adoption means more opportunities
  • How to prepare for the next stage of crypto regulation  
  • Less volatility and uncertainty
  • What about taxes?



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       In the United States, the House Financial Services Committee, which discussed broader crypto regulatory issues in December, turned its attention to stablecoins as vectors for regulation. As of February 9, the current discussion centers around whether stablecoins should be regulated at the federal or state level. Whichever side the Committee is on, there are indications that positive sentiment and wider adoption of digital currencies will emerge. Missouri representative Blaine Luetkemeyer stated that while many cryptocurrencies could threaten the dollar's dominance, dollar-backed stablecoins present a "unique opportunity" for US fiat currencies to remain global competitors and the world's reserve currency.

       The US is not the only country considering crypto regulation, but as a world power and global market influencer, America's stance is sure to set the pattern for other countries. China, with its crackdown on mining and advancing its own CBDC, is building a stricter regime. Other countries seek to pass laws controlling the creation or use of digital currencies, with wide variations around the world creating uncertainty as well as opportunity.


       Crypto regulation is coming, no matter what part of the world you operate in. It has been around since cryptocurrency and blockchain technology made the leap from the dark corners of the Internet's niche to daily headlines. Institutional economic actors such as multinational banks and crypto-investing funds, and states can be considered the slowest and most powerful economic actors. Although Bitcoin (BTC) and Co. can be seen as a threat to the state, there are ways that the two can be mutually beneficial, and traders need not be afraid of regulation.







  • Consumer protection

           State authorities are already active in the fight against crypto crime. This week, US officials confiscated about $3.6 billion worth of Bitcoin linked to the 2016 hack of crypto exchange Bitfinex. If crypto users want to have protection under the law against bad actors, then crypto itself must accept the rule of law.

           As crypto has become mainstream, stories of scams and scams have abounded. From fake addresses to carpet pulls to fake NFTs defrauding artists, the fact that crypto transactions are immutable, difficult to trace, and operate in a legal gray area has taken many victims.

            In order to have consumer protection and protection, it is necessary to cooperate with the government, and this means accepting some regulations. The crypto industry itself is aware of this and has formed groups, such as the Cryptocurrency Compliance Cooperative, to work with state authorities to set industry standards and fight market manipulation.

 

  • Increased adoption means more opportunities 

           In fact, the crypto community can thrive in a regulatory environment. Take Singapore for example, which saw a tenfold increase in crypto-related investments last year worth $1.48 billion, up from $110 million in 2020, despite the central bank cracking down on crypto advertising and business licensing. Instead of being bad for businesses, regulation can give startups and investors confidence to operate and start new blockchain projects which can be attractive assets to trade.

          Crypto's lack of regulation made it attractive to innovators and people on the fringes in its early days, but also to criminals. That, combined with the conservative nature of financial institutions, is slowing growth and adoption worldwide as investors move away from this risky asset sector. However, the overall value of cryptocurrencies is likely to be driven by interest from institutional investors, as well as the creation of blockchain solutions that integrate with mainstream financial systems (e.g., XRP, Ethereum-based DeFi projects, and CBDCs). If we want to see more blockchain projects bridging the transition between the old and new money economy, regulation will help build that bridge.


  • How to prepare for the next stage of crypto regulation

           Savvy crypto traders will follow international news and research government activity as they do with market trends. Now is the time to anticipate future regulation by accumulating cryptocurrencies before potential country demand becomes too heavy and predict which coins will be driven in value by specific countries' support for crypto. For both of these activities, StormGain provides the best tools for crypto trading in all circumstances, including low commissions, free Bitcoin cloud mining, and advanced analytics, all in one easy-to-use app. Are you ready for the new era of crypto? Then REGISTER with StormGain in just a few seconds to maximize your profits!


  • Less volatility and uncertainty

          Clear and consistent regulations that fall outside of outright prohibition may be the answer. For example, Kazakhstan, where many miners migrated after China's ban, has decided not to react with its own ban. Instead, he has proposed a tax on mining hardware as well as an increase in the price of electricity for mining operations. This compromise could help the mining industry find a stable home and avoid major disruptions like the Chinese exodus.

        Market volatility can be a boon to speculators, but in the long run, more stable investments can lead to bigger returns. Uncertainty and inconsistent regulation can dramatically disrupt crypto markets, as was the case with the recent Chinese and Russian crackdowns, with previous mining bans being a big factor in the crypto market slump.


  • What about taxes? 

          With the huge amount of money being made in the crypto space, it is inevitable that the country will try to tax these profits. In India, the finance ministry announced the launch of an Indian CBDC later this year or next, along with a 30% crypto tax. The increased adoption has also inspired Colombian tax authorities to take a tough stance against crypto tax evasion, while in Venezuela, the government wants to impose a 20% tax on some crypto transactions. While taxes are meant to be used for the benefit of society at large, not all merchants will be happy with states taking a share of their income. So, if taxes are the downside, what are the advantages of regulation? 

 

 

 

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