Regulation to Play Crucial Role in Cryptocurrency, Bitcoin Comeback
Some industry experts believe that regulations will play a crucial role in the development of the cryptocurrency market.
Financial experts monitoring the movement of digital currencies, particularly the recent market correction, have all agreed that regulations aimed at protecting consumers and allowing the technology to evolve further will play a major role in the crypto market's future.
In an article written for Mashable, Stan Schroeder said he interviewed several industry experts about the latest market sell-off in Bitcoin and other cryptocurrencies. He also sought their views on how the space can stage a comeback, and all turned out to share the opinion that regulations could bring stability to the sector.
Nikolay Storonsky, CEO of electronic wallets provider Revolut, believes regulation will benefit the industry. He said:
"Consumers need protecting, and the space needs to evolve if widespread adoption is ever going to occur.”
CryptoCompare CEO Charles Hayter sees the crypto market movement as a "healthy" but "large short-term correction." He described the current regulations being imposed by various governments as positive and likely to "bring rigor and long-term stability."
Hayter even supports the moves by several major banks in the US and the UK banning the purchase of Bitcoin with credit cards. He stated:
"The credit card blocking was a sensible move — allowing people to buy speculatively on a loan has had historical precedence for being imprudent and adding fuel to the fire.”
Trevor Gerszt, head of digital currency savings platform CoinIRA, opined that the virtual money industry might have survived the worst as it has already seen and felt the impact of Chinese rules. It's a bullish market on the crypto space, he commented, going on to add:
"With the crackdowns occurring in China, we're seeing a fair amount of turmoil and fear. There's really nothing for investors in the US to be afraid about... Now that China seems to have gone as far as it can go, we should have reached the end of downward price movements based on fears of further Chinese government action."
Regulations could help cryptocurrency thrive
The trio are not the only industry observers to believe that the crackdown on cryptocurrencies by financial regulators will eventually benefit the industry and even allow it to thrive.
MIT Sloan School of Management’s assistant professor Christian Catalini said that regulations are “useful” because they would provide clarity “that will actually allow the space overall to thrive.”
He explained that regulating the industry is good because the rules will be enforced to protect consumers against criminal activities, especially from hackers and scammers. Companies involved in the blockchain space could also take advantage of better protection against cyber threats and attacks.
‘Right’ regulation is good for blockchain, crypto industries
In an exclusive interview for Cryptovest last month, Zachary Piester, co-founder and chief development officer of Bitcoin and Ethereum venture studio Intrepid Ventures, said that the right regulations would benefit the cryptocurrency industry and the blockchain community as a whole. He sees them as a way to “eliminate bad actors, protect investors’ interests, and encourage free trading.”
Piester does not support calls by some industry players for self-regulation or self-governance, saying it would not help the crypto markets. According to him, the right amount of regulation will be advantageous to all players.