The Problems of Regulating Cryptocurrency Globally

Cryptocurrency has been seen as a better form of traditional currency in the market because of the somewhat new technology that has been introduced in transactions, buying, trading, and exchanging services. Many experts have researched these changes, and their reviews were positive towards using cryptocurrency as an alternative to common paper currency.   

Although, being a recent currency has made cryptocurrency prone to certain market aspects. This aspect has made cryptocurrency the main criticism from a small proportion of people, which is not negligible. Check resources like bitcoin profitapp to know more about cryptocurrency trading. These criticisms directly point towards the flaws of cryptocurrency and can be troublesome if implemented in the international market.  

Some cryptocurrency companies have listened to these critics and made possible changes to make virtual coins more open and admirable. But there still are problems regarding regulations of cryptocurrency usage in the market. But these are covered by various factors that make it hard to establish proper terms and regulations regarding cryptocurrency usage. So let us see what factors prevent cryptocurrency from being a fully regulated platform.  

Risk warning: Cryptocurrencies are high-risk investments that should not be undertaken lightly. As this article reiterates, cryptocurrencies are generally unregulated and you may have little government protection if things go wrong. As a general rule, if you only invest money you can afford to lose then you have protected yourself against sudden market shocks.

What are the factors preventing cryptocurrency regulation?  

As you might have known, cryptocurrency is a decentralized medium, meaning that all the assets are not in control of any government or authority. This feature might be a head start for cryptocurrency, but it is not flawless.  There is no authorized supervision on cryptocurrency usage or rules on regulating cryptocurrency. As a result, cryptocurrency coins or tokens are not especially economic friendly as they do not always obey the limitation of a currency used thus far. 

Another factor is cryptocurrency being a digital or virtual currency. Applying specific terms and conditions to a digital currency is more challenging than regular currency. Moreover, these terms can be bypassed by hackers or criminals, making it more challenging to hackproof. There is also the case that cryptocurrency is out of the power of governmental control. Due to cryptocurrency being anonymous between parties, making cryptocurrency the best investment for fraud groups, including replicating fake virtual coins and using them in exchanges. Another factor is investing in cryptocurrency being very dynamic in the market because it is used in many fields of the market, such as investing, buying, trading, etc. Therefore, making terms that engulf all the problem is nearly impossible and inefficient. 

What is the impact of unregulated cryptocurrency markets?  

Millions of people worldwide have used cryptocurrency; any flaw in regulation could threaten the entire community using the cryptocurrency. Unfortunately, some cryptocurrency has not been regulated, which made various groups use them as a disguise to make people purchase them, requiring them to provide confidential information such as bank account details, who later became the victims of cybercrimes. It has become the reason for fear and doubt in using cryptocurrency.  Making cryptocurrency companies fall from the ideal peak they have the potential to achieve.   

To counter these problems, one of the solutions recommended was to make cryptocurrencies under the control of the government so that they can be regulated as per governmental policies. The best cryptocurrency books suggest that this will be a difficult process.

However, this decision contradicts the decentralized property cryptocurrencies usually inherit, making cryptocurrencies in the hands of governmental authorities who can change terms to what they find suitable. Moreover, the law and order deficiency cryptocurrency has been facing has made many countries restrict the usage to a maximum. To avoid instability in the economic marks, which is not good news for those who own cryptocurrency.  

Contrary to the above-discussed beliefs. This lack of regulations is more appealing to cryptocurrency investors or traders as they can use them without otherwise imposed restrictions on regular currency or commodities. But it can be fatal to the economy as the government is closed to cryptocurrency; people tend to approach illegal trading sectors or smuggling groups who trade valuable assets without official documentation, destabilizing the market affairs to an alerting amount.  

Cryptocurrency is seen as a beloved currency, and the future people have been dreaming about it without proper regulation as economists and researchers have been working on it. But, unfortunately, they may not find the ultimate solution to all these problems shortly. Still, many ideas have been prosed and implemented to regulate cryptocurrency satisfactorily, including significant help from virtual coin companies themselves who have stepped up to be regulated and demanded in the international market.