Bitcoin – a Great Friend but an Even Greater Foe

Big governments around the world are catching up with the cryptocurrency craze. Apparently, they’re on a hunt for blood. After announcing the ICOs are greatly influencing financial and economic order in China, the government banned all forms of ICO funding. It happened in October 2017, with bitcoin losing nearly 10%, Litecoin 24.92% and Ethereum 21.74%. In Venezuela, the government has began locking up Bitcoin miners, although because of the severe financial crisis, cryptocurrency might actually help overcome a complete financial blockage.

Previously the head of the state Nicholas Maduro has said Venezuela would issue 100 million tokens, each backed by the equivalent of one barrel of Venezuelan oil. This will make the entire value of tokens a little over $6 billion. The pre-sale is about to start on February 20th, but critics strongly doubt that such measure could pull the country out of the economic crisis. Besides, some consider it illegal.

As far as South Korea is concerned, which is also one of the most popular Bitcoin markets in the world – the ban on anonymous cryptocurrency trading has just been enforced.

The overall crypto market is challenged by Asian regulations, and as of January 30 South Korea Financial Services Commission enabled a set of rules that allegedly are meant to reduce illegal cryptocurrency activities, such as “money laundering, crimes, and tax evasion.” The new terms and conditions imposed challenge the status quo of cryptocurrency, which is anonymity. All traders will have to link their crypto exchange accounts to their bank accounts using their real names.

The South Korean situation with the crypto market is, at the very least, complicated. At first, the government’s intention was to ban crypto trading entirely. But the Korean people reacted and filed a petition to fight than. They called it a “happy dream”, and its intention was to compel officials to declare their crypto assets. After dealing with several pain points related to privacy failure, several Korean crypto exchanges were penalized, influencing once more the price of Bitcoin.

Rather than befriend Bitcoin, big governments in Asia and the US claim their actions are meant to protect the people from market manipulation. However, they’re actually attempting to kill a currency that poses a threat to government monopolies on seigniorage income and printing money. Somewhere somehow, innovators who understand the crypto world were joined by enthusiasts and early adopters that see the potential of an “exotic” currency – a better, more transparent hedge that’s better than gold, can be used for cross-border payments, and has a limited supply of 21 million.

Things could take a turn to the better in Europe, where a member of Germany’s Bundesbank, Joachim Wuermeling, highlighted that an attempt to regulate Bitcoin and other cryptocurrencies would demand international cooperation, as “the regulatory power of nation states is obviously limited.”

On December 22, Belarus legalized cryptocurrency transactions, marking the beginning of a journey to attract foreign investment and foster growth in the private investing sector by freeing the people from Soviet-style stigma. In Russia, The Ministry of Finance recently presented a Digital Assets Regulation Bill meant to legalize and regulate cryptocurrency trading, mining, and ICOs. Given that the Central Bank of Russia is a centralized entity, the officials disagree on several grounds, emphasizing the cryptocurrency trading rule should apply to tokens with real potential to attract viable financial investments.

The creators of the bill argue that legalizing cryptocurrency would reduce financial fraud and provide better fiscal transparency. But approving the bill doesn’t mean cryptocurrency will become a legal payment instrument in Russia, as trading would only be allowed through compliant exchanges.
Source : https://www.ccn.com/fighting-bitcoin-cryptocurrency-trading-threat-government-policies/
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