By
Chimamanda U. Martha
April 24th, 2024
The U.S. derivatives regulator is studying whether it should regulate virtual currencies, its chief said on March 11, 2014, as regulators across the globe start taking the emerging technology more seriously.
There were debates around Bitcoin ever since it became popular and accepted. The major topic being discussed is the regulation of transactions provided in this currency and its usage in common.
And today finally world’s leading economy is determined to create strict regulations for Bitcoin and other virtual currencies. As reported, the state of New York is taking applications from enterprises that want to acquire their ‘Bitlicense’.
T he regulation and security terms became desirable after several incidents involving Bitcoin.Among them is the recent failure of Mt. Gox, which announced bankruptcy after losing an estimated $650 million worth of customer Bitcoins
Unlike fiat currencies, Bitcoin is generated by computer systems and is controlled independently, so it can’t be regulated by a government or a central bank. Thanks to that Bitcoin and other digital currencies are not vulnerable to mishaps.
“I think people believe there’s a pretty good argument that it would fit that definition. Then there’s a separate question about whether or not there is some derivative contract based on, or denominated in a virtual currency and whether that’s listed on an exchange. There’s some looking into that question too, but it’s impossible to offer a timeframe for any final decisions”, said Mark Wetjen, acting chairman of the Commodity Futures Trading Commission (CFTC), which regulates the commodity futures and options markets. It does not seem that CFTC wants to claim its dispute on the regulation.
Recently it was admitted by Japan, that Bitcoin is an unworthy currency, but on the other hand, some transactions in it should be taxed. Japan considers regulation of Bitcoin, although calling this cryptocurrency unworthy and taxing it at the same time is a bit contradictory
In every country there are different points of view on Bitcoin and other digital currencies in general. Ideas to ban the cryptocurrency face a negative feedback from the public. Because of that, United States do not announce anything determined: they’re not making any promises but, on the other hand, they’re not saying no to Bitcoin either.
It is obvious that the regulation of cryptocurrencies is needed, but it depends on what government is going to do with Bitcoin and its equivalents. If they will manage to preserve Bitcoin’s advantages in some sort of legal framework, it would be accepted by public and digital currencies will flourish.
However, only time will tell, whether it is going to work or not.