With recent developments on cryptocurrency trading regulations from countries such as South Korea, the cryptocurrency community is on edge for similar updates that might come from other markets.
One such region is the U.S., where cryptocurrency trading is gradually but noticeably gaining traction. Not only have relevant exchanges been obtaining momentum regarding growth, but other sectors within the country are also rife with talks of cryptocurrency based financial products, the last of which had been Bitcoin futures that are currently trading on the Chicago Board Options Exchange (CBOE) and the CME Group.
Taking these facts into consideration, there had been speculation that the U.S. might take steps towards regulating Bitcoin and related cryptocurrencies shortly, but those rumors have now been quashed by a high ranking White House official.
Bitcoin regulation is not happening anytime soon
Speaking at the Munich Security Conference, Rob Joyce, White House cybersecurity coordinator and special assistant to the president, mentioned that there is a need to thoroughly analyze and understand Bitcoin and its related cryptocurrencies before any regulations could be imposed upon them.
Elaborating on his statement, Joyce stated that the new financial instrument has its positive and negative uses, which need to be recognized before further steps could be taken.
“I think we’re still absolutely studying and understanding what the good ideas and bad ideas in that space are.” He mentioned, adding that he does not think that any regulations are going to be implemented shortly until these factors are clear.
However, while Joyce mentioned the use cases in both positive and negative connotations, he was quick to point out that the usage in the latter is more apparent due to the anonymity that Bitcoin and other cryptocurrencies offer to their users.
“We are worried. There are benefits to the bitcoin concept — digital cash, digital currencies,” he mentioned.
While referring to the risks that cryptocurrencies bring to the table as compared to a conventional currency that remains trackable, he said:
“But at the same time, if you look at the way bitcoin works after there is a criminal act that takes place, you can’t rewind the clock and take back that currency.”
Joyce’s concerns were on the same lines as those of regulatory authorities from the European Union (EU), which passed a set of regulations in December 2017 that mainly pertained to end anonymity from cryptocurrency transactions, citing that untraceable transactions help in facilitating criminal activities. Said regulations from the EU are set to go into effect by the end of this year, provided that their implementation goes smoothly in participating nations.
As per Joyce, however, before the U.S. could move forward with such steps, it would need to study cryptocurrencies some more to ensure that any regulatory steps are taken after careful consideration.
What does this mean?
While the statement does not say much, it does hint at the possibility of regulations – whenever they are implemented – to revolve around ending the anonymity which comes with using cryptocurrencies.
This would most certainly cause a problem for the proponents of the initial concept of cryptocurrencies, which was to break free of central banks’ regulations and authorization.
However, while following regulations very clearly goes against this concept, it would evolve cryptocurrencies into a financial asset with mainstream recognition.
It remains to be seen how the cryptocurrency community deals with the continuing talks on regulations, and whether choosing to go mainstream while complying with regulations seems more beneficial, or the option of staying under the radar while “fighting the power.”