The process of regulating the cryptocurrency market is relevant not only for officials, but also necessary for users. Cryptocurrencies are now at the peak of popularity, but so far they do not have enough requirements and acts, which would regulate reliably and resolve many issues.
Regulation of any process should be carried out at the legislative and executive levels. In the framework of the first, the regulator will assign cryptocurrencies to unknown tools, due to the novelty and impossibility to control them under the current legislation. That is why proposals are made and bills are launched that will be directed to the impact of the cryptocurrency market. Regulation of the cryptocurrency market is also impossible at the executive level, because it is very difficult to exercise technical control due to data encryption and personal identification.
There are only two possibilities for the executive level:
1. adjustment of the digital currencies flow where it contacts with the legal field;
2. implementation of crypto currencies in various areas.
The following methods can be defined as regulatory tools that can influence the entire crypto market:
• tax – is used in the framework of exchanges, but may also apply to mining, and some countries have already made amendments concerning tax exemptions for business activities;
• issuing licenses – they can license cryptocurrency-related transactions;
• registration of exchanges – the competence to start the platform under certain terms;
• user data processing – verification of IDs and other documents;
• recognition as a payment means – can allow to regulate cash flows by financial institutions, and information comes to the State through banking organizations.
Pros and cons
The first place among the positive sides goes to the improvement in the security system quality, since the present systems do not own special security, especially with the development of fraud and hacker activity.
Another advantage stands out the possibility of expanding the cryptocurrency market through government injections of funds, and not thanks to investors, as it is now. Since the blockchain and other solutions give excellent results, being a promising project, this scenario is near to being completed.
Good advantages also can be for human resources and social fields:
1. As a result of cooperation, new vacancies may appear with good remuneration and the possibility of gaining experience in the field;
2. Demand for professional specialists will lead to opening of specialized educational institutions.
One can single out a decline in income as a weak side, after tax payments, and also the main thing that all participants fear is the loss of anonymity. It is also most likely not to do without bureaucracy: certificates, paperwork, and more. As a result, the cryptocurrency exchange will come out of the shadows, cryptocurrencies become more stable, and security is even better. However, not everyone will like disclosure of anonymity, especially large players who want to control processes imperceptibly from others.