Do we need regulations for cryptocurrency trading and investment? Explain
Yes, we do need regulations for cryptocurrency trading and investment. (. Basiouny,2022),explains that Biden’s executive order to establish a national policy on cryptocurrency is a powerful beginning in putting in place barriers around the global market, according to Wharton’s Kevin Werbach. The executive order seeks to protect consumers and those investing. It aims at preserving financial stability, ensures financial inclusion and guides responsible innovation. The bottom line is that these regulations will help fight digital currency scams, fraud and manipulation like traditional finances.
Should the regulations be national or international? What are the key arguments for both?
The regulations should be international. The critical arguments for both are that national authorities have taken contrasting strategies to rules regarding crypto assets. On the one hand, the authorities have banned the issuing or using of these assets to transact or make payments by residents. On the other hand, some countries have been open to using these assets and even tried persuading companies to set up markets for these assets. Moreover, International regulations will encourage consumer confidence and allow beneficial creativity to continue (Brown,2022).
Should Crypto be banned altogether? If not, what are the main reasons?
Crypto should not be banned altogether. Banning Crypto entirely is impossible as Congress, the courts and the international community have rejected the idea. They instead have supported the idea of regulating Crypto. Additionally, the white house has intended to work with Congress to hold rather than bun Crypto. Consequently, the court will be an obstacle to banning Crypto. Crypto provides many American jobs, and denying it will be a significant economic question. As a result, the Congress will be required to answer. Finally, Crypto being global, other countries will not accept banning Crypto (Smith,2023).
What are some of the key takeaways from the FTX fiasco? See the article below.
According to (Davis et al .,2022), some key takeaways include being aware of the cult personality. , Cult personality involves famous people promoting FTX as an easy and safe shortcut to getting into Crypto. Frauds understand that appearances on T.V. easily sway investors, sponsorships of corporations and businesses that are backed by celebrities. However, these T.V. corporate marketing departments and stars do not investigate these companies. Even though crypto promoters like Kim Kardashian are called out for sending the right message to the market, investors still get fooled. FTX fraud ensures there is doubt and effort. Another takeaway from the FTX fiasco is that one should invest in a business and not a cause. FTX was based on the fact that they were to use all the money for charity, though it was not the case. They were only interested in making it their own. Either way, many poured in from those who believed in the greater good other than earning profits. Therefore, the decision to invest should be primarily on a business rather than its good intentions.
Describe some of the major concerns from the Milk Road article
.Among the significant problems from the Milk Road article is the bear case, that is, why the crypto market could bleed a little longer. Some of the reasons why the bear market could continue include Crypto hacks. Crypto has been plagued by hacks, resulting in the loss of over 8 billion dollars since 2021. The more people fall prey to these hacks, the more people leave the industry, or they might never enter the sector for fear of losing their money to hackers. Additionally, unnecessary regulations kill any innovation in the crypto space.
Regulators in the USA are turning the heat on anything and everything regarding Crypto. When big companies and businesses are forced to pay huge fines and close certain operations, it leads to fewer companies investing in Crypto and its projects. As unnecessary and extreme regulations on Crypto continue, the harder it will become for Crypto to reach the majority.
References
Basiouny, A. (2022, March 28). Why the U.S. government should regulate cryptocurrency. Knowledge at Wharton. https://knowledge.wharton.upenn.edu/podcast/knowledge-at-wharton-podcast/why-the-u-s-government-should-regulate-cryptocurrency
Brown, R. (2022, September). Regulating Crypto. IMF. https://www.imf.org/en/Publications/fandd/issues/2022/09/Regulating-crypto-Narain-Moretti
Themes. (2023, September 14). ???? 4 BIG threats to Crypto???? Milk Road. https://milkroad.com/daily/4-big-threats-to-crypto/
Smeltzer, J., & Davis, C. (2022, December 12). Five takeaways from the FTX cryptocurrency exchange fallout. J.D. Supra. https://www.jdsupra.com/legalnews/five-takeaways-from-the-ftx-1984342/Links
Smith, K. (2023, April 27). The case for regulating, not banning, Crypto. CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data. https://www.coindesk.com/consensus-magazine/2023/04/27/the-case-for-regulating-not-banning-crypto/
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