There is much cause of worry which includes scams through initial coin offerings, to acts of money laundering, cyber thefts, speculation trading to the funding of terrorist and criminal organizations through cryptocurrencies. Virtual currencies suddenly brought turmoil to the market as the prices shot up last year and these coins are slowly and steadily becoming mainstream. The profits and returns are enormously high now as everyone from a trader in a remote town to Wall Streets banks is all geared up to take their chances on cryptos.
Two of the top market watchdogs in the United States highlighted in February that the country has not yet framed a comprehensive set of rules for the digital currencies. This apparently means that the country needs to give federal agencies more power and proposition. The U.S's Securities and Exchange Commision (SEC) till now has focused mainly on looking after of increasing scams resulting out of Initial Coin Offerings. There have been further talks on Exchange-traded funds (ETFs) as Commodities Futures Trading Commission permitted two of the world's biggest exchanges to put bitcoin futures on their listings in December last year. This was comprehended as the mainstream recognition of Bitcoin trading. Nonetheless, the same month CFTC sent a subpoena to Bitfinex and other major trading avenues. In the meantime, the Treasury Department is also working together with the Justice Department to search for money laundering cases. The state governments in the country are too running to stop the use of virtual currencies for illicit purposes.
China: The most severe approach has been taken by China so far. Interestingly, China is one of that country which was labeled as the most vibrant market for Bitcoin trading. Currently, the nation bans both ICOs and cryptocurrency exchanges along with mining.
Japan: If we talk about Japan, whose Tokyo based exchange witnessed one of the biggest exchange heists at the end of January 2018, has adopted a rather kinder stance on the virtual currencies. The country proposed a licensing system for the trading avenues, and as a result, there are now 16 licensed cryptocurrency trading exchanges in the country. As Japan took a more liberal view of the space, it has now made the top spot in Bitcoin transactions from China.
South Korea: South Korea is one other country having a right amount of hold in the digital currency space. The state warned about the closing of exchanges which resulted in outrage from the people. The nation after a two-month long deliberation decided to opt for a much softer attitude by just ending anonymous trading on exchanges.
Other countries: European Union’s markets authority has notified about the hazards of investing in cryptocurrencies, and there are differential regulations across the continent. While French authorities have started a crackdown on the space, Switzerland’s has a more welcoming approach.
Banks being a traditional channel for the flow of funds play a significant role in the financial sector. If we talk about their involvement in the space of cryptocurrencies, there is almost nil. Bigger banks have maintained their distance from the area and in fact, have now barred the user's purchase of cryptocurrencies from the credit cards. Most of the more prominent banks like JP Morgan Chase & Co, BofA Corp. and Citigroup Inc. were the one to initiate the ban. Many big lenders are trying to avoid any dealings with cryptocurrencies because of know-your-customer and anti-money laundering rules. Bitfinex ended its relationship with Wells Fargo & Co. in March 2017, and now the recent report claims that have opened an account with ING group in Netherland. Only Bitcoin Futures market seems to be more affirmative, but there have been not much higher volumes trading.
This year's G20 Summit is one of the most awaited one for the cryptocurrency analysts and enthusiasts because it may pave the way for future stance on the space. Many countries have revealed that they are willing to discuss the future of the virtual currencies with France and Germany taking the lead. This will surely help in establishing the global norms for regulations which were called by the International Monetary Fund in January this year. Even Korean officials have vowed in the media that the country will soon come forward with a broad set of rules fast and on the other hand, the European Commission is evaluating the bloc’s regulatory framework.