What are the regulations for Cryptocurrency?

The sale of cryptocurrency is generally only regulated if the sale (i) constitutes the sale of a security under state or Federal law, or (ii) is considered money transmission under state law or conduct otherwise making the person a money services business (“MSB”) under Federal law.

Why is regulation bad for Cryptocurrency?

Regulations can be good or bad depending on the specifics of the regulation and the overall number of regulations. Some regulation is needed, but over-regulation could kill or limit innovation and growth in the crypto market.

Does the US regulate cryptocurrency?

One of the founding principles of cryptocurrency is that it’s decentralized and unregulated. But the U.S. government isn’t too worried about crypto’s founding principles. In fact, cryptocurrency regulation has been a frequent point of interest lately for U.S. lawmakers and government agencies.

Can the government regulate Cryptocurrency?

First, governments can regulate the price of assets, such as fiat currencies, through buying and selling actions in international markets. Most states require surety bonds or an equivalent amount in fiat currency for cryptocurrency exchanges within their jurisdictions.

Who regulates Cryptocurrency?

Right now, cryptocurrencies fall under the jurisdiction of the SEC for investment, the CTFC for any crimes involving interstate commerce, and the IRS, making it subject to either income or a capital gains tax. The SEC recently approved one Bitcoin futures ETF over the CBOE and one over the CME.

Is a flexible regulatory framework needed to regulate cryptocurrencies and ICOS?

A flexible regulatory framework will be necessary to keep pace with the rapid developments in cryptocurrencies and ICOs while addressing their risks. In the short term, regulators have to consider how the existing regulatory framework applies to ICOs and cryptocurrencies or the platforms on which they are exchanged or issued.

What are the major issues in the crypto market?

Despite the large market capitalization of the crypto market, huge price fluctuations and the increase in demand to trade cryptocurrencies, the market faces major issues associated with structural, functional, security and regulation. One of the major issues that confront the market is excess volatility and liquidity issues.

How can compliance departments deal with cryptocurrency risk?

While meticulous recordkeeping and a lack of opacity will go a long way toward reducing some of the risk inherent in cryptocurrency dealings, compliance departments must also grapple with regulatory issues.

Are cryptocurrencies a new asset class for regulators?

Nevertheless, the growing interest in and investment by consumers and firms in cryptocurrencies and tokens issued through ICOs as a new form of asset class usually outside the regulatory perimeter have caught regulators’ attention over the last few months.