Tuesday, March 28, 2023
  • Login
CEO North America
  • Home
  • Business
    • Entrepreneur
    • Industry
    • Innovation
    • Management & Leadership
  • CEO Interviews
  • CEO Life
    • Art & Culture
    • Food
    • Health
    • Travel
    • Environment
  • Opinion
  • News
  • Multimedia
No Result
View All Result
  • Home
  • Business
    • Entrepreneur
    • Industry
    • Innovation
    • Management & Leadership
  • CEO Interviews
  • CEO Life
    • Art & Culture
    • Food
    • Health
    • Travel
    • Environment
  • Opinion
  • News
  • Multimedia
No Result
View All Result
CEO North America
No Result
View All Result

Cryptocurrency Regulation: Where are We Now, and Where are We Going?

in Opinion
Cryptocurrency regulation: where are we now, and where are we going?
Share on LinkedinShare on WhatsApp
  • The total market cap of digital currencies is $1.7 trillion and over $90 billion worth is traded every day.
  • Analysts have warned that the industry is so large it could have macroeconomic consequences if mismanaged.
  • Piecemeal approaches to cryptocurrency regulation must be replaced by a globally coordinated framework.

Early in March, President Biden signed off on the long-awaited Executive Order on Ensuring Responsible Development of Digital Assets, a high-profile acknowledgement of the potential of the cryptocurrency industry.

That Executive Order commits the White House to taking part in research on cryptocurrencies and to engaging departments across the government to collaborate in the creation of a regulatory framework for digital assets. It also outlines a “whole-of-government approach to addressing the risks and harnessing the potential benefits of digital assets and their underlying technology.”

According to the World Economic Forum’s Digital Currency Governance Consortium’s Steering Committee Member, Jeremy Alliare, “the Executive Order sets out initiatives to explore and engage in constructive problem solving around known risks that exist with the legacy financial system, and the new Web 3 world.”

This exploration, Allaire added, will cover “privacy, security, financial inclusion, global competitiveness for USD,” and more.

The White House is about to make a concerted effort to regulate the digital asset industry — given the size and growth of the industry, that push cannot come soon enough.

Today, there are 18,142 cryptocurrencies, 460 crypto-exchanges and the market cap of cryptocurrencies amounts to $1.7 trillion. Every 24 hours, $91 billion worth of cryptos are traded, most of them Bitcoin or Ethereum.

Given the size of the industry and the impending regulatory push, it is worth now taking stock of the current state of regulation. In doing so, it will become clear that a globally coordinated approach to regulation is necessary.

Cryptocurrency regulation is imperative

As the traditional financial system connects with the burgeoning crypto ecosystem, the growing interconnectivity raises concerns of spillover effects that could impact systemic stability.

For some time, cryptocurrency has been seen as a tool for diversification, but the tea leaves are starting to read differently. Earlier this year, the International Monetary Fund (IMF) released data indicating a correlation between bitcoin and the S&P 500. This raises fears of spillovers of investor sentiment between the stock market and cryptocurrencies.

Shortly following this analysis, the Financial Stability Board warned of implications for global financial stability if the current trajectory of growth in scale and interconnectedness of crypto-assets with these institutions continues. However, given the many data gaps that exist with regard to crypto-assets, a comprehensive macroeconomic impact assessment is still somewhat out of reach.

Moreover, the nature of the underlying technology for cryptocurrencies is such that it enables cross-border transactions without the need of any or existing financial intermediaries.

New applications and models such as tokenization, decentralized finance, NFTs (non-fungible tokens) and decentralized autonomous organizations challenge traditional models that outline who is currently considered a “person,” what is “value” and how this “value” can be transacted. This threatens to come into direct conflict with existing regulations pertaining to cross-border data flows, intellectual property rights and capital controls. It could also lead to ambiguity in the taxation environment, as well as posing a host of other policy concerns.

The potential implications of cryptocurrencies for global financial stability, and the distinctive nature of the underlying technology, evidence the importance of prioritizing regulatory discussions and decisions, both at a national and a global level.

Current state of play in regulation

According to the World Economic Forum’s Global Future Council on Cryptocurrencies, there has been no internationally coordinated regulation of cryptocurrencies — though international bodies have been working on assessing risks and appropriate policy responses to the rise of cryptos.

Globally, central banks and regulators already have their eyes on this growing trend. Though they share a common objective — stabilizing their monetary systems and spurring innovation and economic growth — countries from China to El Salvador have already starting weighing up and implementing different regulatory options.

For those countries, their objectives appear to broadly align: protect the consumer, prevent illicit financing, protect the integrity of the market and promote innovation. Their approaches, however, vary.

While some jurisdictions, such as India, have amended existing laws, others, like Liechtenstein, have proposed bespoke models. Another approach, seemingly favoured by the European Union and UAE, proposes setting up entirely new regulators to deal with the industry in a comprehensive manner.

These territorial differences, while offering jurisdictional arbitrage opportunities, create uncertainties and increased compliance burden for businesses operating in the sector. This is exacerbated by the absence of common standards and terminologies.

For a truly global coordinated approach, countries and international organizations must work together, leveraging best practices and learnings from each other. As well as risk assessments and establishing common standards, there is also a pressing need to leverage the technology itself to develop fit for purpose and inclusive solutions, through public-private collaboration.

(Courtesy World Economic Forum//By Kathryn White Project Fellow, Centre for the Fourth Industrial Revolution, World Economic Forum Arushi Goel Specialist, Data Policy and Blockchain, World Economic Forum, C4IR India Sandra Waliczek)

Tags: crypocurrenciescrypto regulation

Related Posts

Do you know why your employees are leaving?
Opinion

Do You Know Why Your Employees Are Leaving?

Here are the 5 key drivers of employee engagement
Opinion

Here are the 5 key drivers of employee engagement

What do your customers want in 2023?
Opinion

What Do Your Customers Want in 2023?

Five questions all leaders should always be asking
Opinion

Five Questions All Leaders Should Always Be Asking

Two basic problems of a declining population in a country
Opinion

Two basic problems of a declining population in a country

4 surprises all leaders face
Opinion

4 Surprises All Leaders Face

Women get “nicer” feedback — and it holds them back
Opinion

Women Get “Nicer” Feedback — and It Holds Them Back

Does it feel like your department has been sidelined?
Opinion

Does It Feel Like Your Department Has Been Sidelined?

How to test if your interview process is a nightmare
Opinion

How to Test If Your Interview Process Is a Nightmare

Helping gen z employees find their place at work
Opinion

Helping Gen Z Employees Find Their Place at Work

No Result
View All Result

Recent Posts

  • Symbotic’s CEO Rick Cohen shines a light on the consumer goods supply revolution
  • CEO John Wynne outlines how Fortis Solution Group is disrupting the packaging industry
  • CEO Keh-Shew Lu explains how Diodes Inc is pushing the frontiers of connectivity
  • CEO NA Andrea Pirondini explains why the Prysmian Group is best-in-class at cable solutions
  • Eric Clark on how ONE NTT is driving client-led innovation

Recent Comments

    Archives

    Categories

    • Art & Culture
    • Business
    • CEO Interviews
    • CEO Life
    • Editor´s Choice
    • Entrepreneur
    • Environment
    • Food
    • Health
    • Highlights
    • Industry
    • Innovation
    • Issues
    • Management & Leadership
    • Multimedia
    • News
    • Opinion
    • PrimeZone
    • Printed Version
    • Travel
    • Uncategorized

    Meta

    • Log in
    • Entries feed
    • Comments feed
    • WordPress.org

    • CONTACT
    • GENERAL ENQUIRIES
    • ADVERTISING
    • MEDIA KIT
    • DIRECTORY
    • TERMS AND CONDITIONS

    Editorials – stuart.james@ceo-na.com

    Advertising – media@ceo-na.com

    NEW YORK

    110 Wall St.,
    3rd Floor
    New York, NY.
    10005
    USA
    +1 212 432 5800

     

    MEXICO CITY

    Paseo de la Reforma 296,
    Floor 38
    Mexico City
    06600
    MEXICO

    • CONTACT
    • GENERAL ENQUIRIES
    • ADVERTISING
    • MEDIA KIT
    • DIRECTORY
    • TERMS AND CONDITIONS

    Editorials –
    stuart.james@ceo-na.com

    Editor-In-Chief –

    caroline.sposto@ceo-na.com

    Editorials – editorials@ceo-na.com

    Advertising –
    media@ceo-na.com

    NEW YORK

    110 Wall St.,
    3rd Floor
    New York, NY.
    10005
    USA
    +1 212 432 5800

    MEXICO CITY

    Paseo de la Reforma 296,
    Floor 38
    Mexico City
    06600
    MEXICO

    CEO North America © 2022 - Sitemap

    No Result
    View All Result
    • Home
    • Business
      • Entrepreneur
      • Industry
      • Innovation
      • Management & Leadership
    • CEO Interviews
    • CEO Life
      • Art & Culture
      • Food
      • Health
      • Travel
      • Environment
    • Opinion
    • News
    • Multimedia

    © 2023 JNews - Premium WordPress news & magazine theme by Jegtheme.

    Welcome Back!

    Login to your account below

    Forgotten Password?

    Retrieve your password

    Please enter your username or email address to reset your password.

    Log In