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thedogekid
Regulation in Crypto : Pros and Cons
lhorgic
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2024-04-17 14:36:57
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Hi guys, good to have you back here. I trust you got value from my last post... just as I've promised, I will be going even much deeper into the subject we discussed, which is Regulation in Crypto. Today, we would be looking at the pros and cons of having crypto regulated.
I know some of us might be surprised that regulation crypto still has some drawbacks, well yeah! Every good stuffs has some element of disadvantages when carefully considered. But let's not forget that the major aim of these regulation is for investor's protection and curbing of all manner of illegal financial activities. Anyway we have so much to discuss, let's get into it right away.
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• **Investors Protection:** Of course I should begin with this point, investors protection is one of the major goal of regulating crypto, that sphere would be lawless and highly risky if it not being regulated by some of these well meaning financial agencies.
These agencies ensure that they safeguard investors against all manner of market manipulations and crypto scam activities which is still the order of the day by some malicious folks. It would have been very common and uncontrollable if there were no regulations to discourage many of these players.
• **Discourages Illegal financial activities:**
The crypto space would be a common den for illegal activities if not regulated. Thieves and manipulators would find comfort using crypto for their dubious work. For example, money laundering and terrorism financing would flourish here since these people cannot use the conventional bank to move in and move out money for their selfish reasons.
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They would definitely be checked if they attempt it. Hence the reason why many of them resort to the use of crypto which seems to give them some sort of cover identity. However the regulatory agencies are also on top of their game to ensure that they do not use this channel for their selfish and destructive acts.
• **Boosts investors Confidence:** This is a salient fact that some of us seem not to have seen. There is this thing about an average person who knows his left from his right. Such person believes that when government gets involves in something it means that thing is safe and okay to subscribe to as well.
This involvement of government in cryptocurrency through her regulatory agencies instills confidence in the heart of her citizen such that they also can now embrace the use of crypto and by so doing, there would be massive adoption, thereby facilitating the growth and development of Cryptocurrency.
• **Accurate Information Dissemination:**
These regulatory agencies have taken it upon themselves to equip investors with relevant and accurate information about their investment in digital currency. Ignorant on the path of investor is one of the leverage that most malicious act rides on.
Here is the reason why they go all out to supply investors with updated information that can help them stay secured even with their investment. This they do with the laws they release from time to time for or against digital assets and platform that powers them.
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• **Market Restriction:** Regulation can be for or against depending on how the perception of the regulatory agency. Some regulation leads to restriction in access to the digital currency market, such that you might not be able to trade some Cryptocurrency or assets of your choice.
This sometimes might be based on geographical laws and regulation and not necessarily generic as every geographic location has power to make laws within their jurisdiction.
• **Hindrance to Blockchain growth:** some laws, just as have stated earlier are against innovative Blockchain development, because most of them are some bunch of hard and fast rules which eventually cripples blockchain activities. For this reason people with brilliant ideas on how to integrate Blockchain into our everyday life for ease and convenience would be discouraged and eventually gas out.
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• **Regulatory Complexities:** This Complexities is as a result of the different regulation made for the same digital asset (crypto) in different geographical location. The fact is that what is applicable and obtainable in one location might not be applicable and obtainable in another.
Every lawmaking body and regulatory agencies in every country sets and make their own policies as it suits them. So when all of these policies are enforced, everything becomes complex and complicated for investors.
• **Compliance cost:** Well this is a cost associated with complying with some of these rules. They come at a cost, sometimes investors would need to spend more when transacting. The additional cost is as a result of existing rules guiding the operation of such transaction. Most times, your time might be the price of compliance as you might have to be subjected to some compliance procedures.
In addition you have to keep yourself updated with the changes put out by these regulatory bodies so you do not get caught up in the web as there's nothing like ignorance in the eyes of the law.
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Regulation, as it now appears is like a double edged sword having it advantages and disadvantages. The draw back clearly shows what interference of government in crypto looks like.
Anyways it doesn't reduce cryptocurrency to the conventional style because cryptocurrency also has an established model. What government aims to do is to cut excesses and make that terrain healthy as possible so that everyone can feel safe and secured.
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There you go friends.I would love to wrap it up at this juncture. I want to believe you've gotten so much from this piece. As my usual custom is, I would always encourage that you DYOR to be sure of every financial step you would want to take as I won't be liable for any form of loss encountered by you.
Feel free to share with me your thoughts in the comment section. Thanks for your time once again. Gracias!
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**Disclaimer: This post is made as an education and not investment advice. Digital asset prices are subject to change. All forms of crypto investment have a high risk. I am not a financial advisor, before jumping to any conclusions in this matter please do your own research and consult a financial advisor.**
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Regards
@lhorgic♥️
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