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Topic: Is regulation of cryptocurrency exchanges essential for mass adoption? - page 3. (Read 548 times)

hero member
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I think that mass adoption of bitcoin depends more of business being open to it and folks like us spreading the word about how to use it.

Think in the first trades done by humanity, how they learning to trade goods and services, how they adopt money until the point that every body start to using and work for it...

It's kind of like a domino effect, you know? People learned, taught others, and before you knew it, everyone was on board and using it in their everyday lives. That's how I see Bitcoin too – if more businesses start accepting it and more people show others how it works, it could become a big part of our financial world just like money did back in the day.
There's a common sense in what you've said towards expanding the adoption of bitcoin by  more institutions opening their doors to it's usage just as OP mentioned Honda motors.

But there's a quintessential role that these exchanges play that is peculiar to them alone in the promotion of bitcoin adoption in terms of trading bitcoin and other cryptocurrencies. Which is why a continuous restrictions from these big countries with large crypto users would ultimately affect, stalling the adoption of bitcoin if more countries add to those number such as the UK, Switzerland, Japan etc.

 Although these regulatory policies by the government are projected towards protecting investors for their safety and from getting scammed some of the regulatory conditions ushered to these exchanges by the government of those territories could be inimical to the business growth of the exchange's and since they can't fulfil those conditions they have to exit those sets of countries to operate where the business environment and policies are favourable.

The real deal is that the government are in certain cases self centered with their regulations but since all of these are happening behind closed doors we are not allowed to get the full gist as to what really transpired in the exit of these exchanges from a country they once existed.
hero member
Activity: 1652
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The cryptocurrency industry is currently at a critical stage and the role of exchanges can either "Make or Marr" the growth of the space.

Since 2009 till date, the industry has encountered a mouth watering growth with many institutional adoption of which Honda Motors is the latest to announce purchase of their product via crypto. Let's not also forget Elon Musk also accept payment of crypto for his Tesla cars and other big institution around the world also accept crypto as means of payment to obtain their goods.

This shows the world and future of crypto look promising but one area of particular interest that could potentially hinder this growth seems to be compliance by crypto exchanges to be regulated which of course I personally deem important because of the past event of scam from exchanges, hacks and collapse of some CEX which left investors in shambles.

The leading cryptocurrency exchange Binance which is supposed to take the lead in regulatory compliance seems to be having troubles with many countries already due to one regulatory issues to another ranging from licensing, operating within the legal framework of the country and compliance to regulation in general which have caused their exit from countries like United States, United Kingdom, Canada, Switzerland, Japan and others. Recently Bybit another top crypto exchange has also exited the UK market raising an eye brow about the readiness of this exchanges to extant laws that seek to protect the interest of users and investors.

If this turn of events towards rejecting to be regulated by countries persist, crypto might prolly fade away with time especially if some top exchanges are not operational in top countries like USA, UK, Canada, Japan and the rest.

What are your thoughts?

If regulating the cryptocurrency exchange will...
1. Guarantee the safety of our investments
2. Guarantee that people's investments can be recovered in event of winding up of a particular exchange or perceived scam.
3. Guarantee that people or investors can still carryout operations freely just like in DEX with no strict regulations.

Then, majority of the people will have confidence in cryptocurrency and will be willing to adopt it. Countries too will adopt it since they can now control the system  .

This is not gonna happen and what is gonna happen upon regulation would be as follows:
1. Taxing not just their withdrawal amount but also every single trade like happened in India which pushed some well know crypto exchanges like coindcx & kuber coinswitch to have mass layoffs of their workforce and they are at the brink of either shifting their operations to other country or going bankrupt
2. Eventually crypto will die if regulated because once regulated they can play it as per their benefits and it would be nothing short of a volatile low market cap mutual funds.

Rather, we need to have an genuine inbuild crypto community for this which should work independently unlike some ICO ranking sites who takes bribe and rate projects, we need to build a community amongst ourselves and set up protocols to be applied on crypto projects to be considered as validated projects and there should be monthly review. It not as simple as I have mentioned as there need to be a proper planning and require lot of funds to set this up. Crypto enthusiasts should come together for this else we will be left at the mercy of either the government/regulators or corrupt crypto orgs.
hero member
Activity: 1134
Merit: 643
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The cryptocurrency industry is currently at a critical stage and the role of exchanges can either "Make or Marr" the growth of the space.

Since 2009 till date, the industry has encountered a mouth watering growth with many institutional adoption of which Honda Motors is the latest to announce purchase of their product via crypto. Let's not also forget Elon Musk also accept payment of crypto for his Tesla cars and other big institution around the world also accept crypto as means of payment to obtain their goods.

This shows the world and future of crypto look promising but one area of particular interest that could potentially hinder this growth seems to be compliance by crypto exchanges to be regulated which of course I personally deem important because of the past event of scam from exchanges, hacks and collapse of some CEX which left investors in shambles.

The leading cryptocurrency exchange Binance which is supposed to take the lead in regulatory compliance seems to be having troubles with many countries already due to one regulatory issues to another ranging from licensing, operating within the legal framework of the country and compliance to regulation in general which have caused their exit from countries like United States, United Kingdom, Canada, Switzerland, Japan and others. Recently Bybit another top crypto exchange has also exited the UK market raising an eye brow about the readiness of this exchanges to extant laws that seek to protect the interest of users and investors.

If this turn of events towards rejecting to be regulated by countries persist, crypto might prolly fade away with time especially if some top exchanges are not operational in top countries like USA, UK, Canada, Japan and the rest.

What are your thoughts?

If regulating the cryptocurrency exchange will...
1. Guarantee the safety of our investments
2. Guarantee that people's investments can be recovered in event of winding up of a particular exchange or perceived scam.
3. Guarantee that people or investors can still carryout operations freely just like in DEX with no strict regulations.

Then, majority of the people will have confidence in cryptocurrency and will be willing to adopt it. Countries too will adopt it since they can now control the system  .
legendary
Activity: 3808
Merit: 1723
If you read the SBF trial today then Caroline Edison made it clear that they were insolvent for basically entire 2022. She actually was finally happy when the exchange imploded because her guilty conscience went away because she was dreading the Ftx massive withdraws for the entire year.

This is proof why exchanges need to be regulated. Because you never know what goes on behind the scenes. Everyone trusted FTX but turns out they were the biggest scam of the century pretty much.
jr. member
Activity: 55
Merit: 1
IMHO, adoption and growth correlate to each other and they happen together with the help of regulations. It's a truth and fact and all over these times, not ignoring the contribution of many through the promotion or spreading about decentralization. This is needed by the market to grow and continue moving on and that's through the help of these regulations and centralized exchanges. Even if we don't want that to be the major contributor to this growth, that's what we're seeing. We see the push from financial institutions as well aside from the centralized exchanges that we've seen to be what everyone is talking about. They may not get a license depending on their compliance but most of them are complying on it and no need to get published in media but, as much as we can see it's like every move that they do are all recorded and they're trying to move everything, price, market, etc. by every single good/bad news they make.

I think publishing the name of crypto exchanges who are regulatory compliant will help users make informed decision not to fall victim of exchanges that will suddenly announce their exit from a particular country and give users 2 weeks to withdraw their assets or forfeit it. This is totally unacceptable but unfortunately it's what we see on daily basis. In any case, it's appealing to see some exchanges like Bitget already obtained some necessary licenses to operate in most countries aside USA and some other few countries that is not that crypto friendly. It will be a great development to see more top cex getting licensed because this will obviously give users peace of mind over their assets.
jr. member
Activity: 55
Merit: 1

The leading cryptocurrency exchange Binance which is supposed to take the lead in regulatory compliance seems to be having troubles with many countries already due to one regulatory issues to another ranging from licensing, operating within the legal framework of the country and compliance to regulation in general which have caused their exit from countries like United States, United Kingdom, Canada, Switzerland, Japan and others.

True, but Binance is trying to hide a lot of information, starting from its headquarters and ending with many reports that talk about the misuse of customer funds.

Not only binance most of the centralized exchanges are involved in this kind of activity. They are no better than FTX, they just aren't caught yet. I think the SEC is planning something for binance and they have evidence against it. The resignation of binance CEO from led me to the conclusion that he knows binance can be accused in the future and charge huge penalties.

Does it now mean we don't have trustworthy cex that is reliable?
legendary
Activity: 3276
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Leading Crypto Sports Betting & Casino Platform
regulation exist to give assurance to the customers, if exchange can be regulated, then many will have no doubt towards the investment.
the only thing that holds back many from investing is because unclear regulation towards the investment and the exchange themselves.
I guess with regulation everyone will be trusting more.
but its still unclear about the correlation though, no real research here so all that is just speculation.
jr. member
Activity: 55
Merit: 1
Yes there needs to be some form of regulation. If there isn't then you got exchanges like MtGox, FTX, Gemini Earn where people put their entire life savings in and end up with nothing. What happened with FTX should of never happened but it did because there was no regulation.

I am watching their trial and they basically had fake money running the exchange for many years and they got away with it because there was no authority who could verify any of their financial obligations. Hence for mass adoption there needs to be some regulations in play so people aren't afriad of making a deposit and worry about getting all their money stolen.

Couldn't forget Bitfinex hack of 2016 as well. People have really lost fortunes to a lot of anomalies from crypto exchanges and I think any cex against regulations at this critical moment have some ulterior motives. It's relieving to see some exchanges already complying with these regulations.
jr. member
Activity: 55
Merit: 1
It is possible that an exchange will not be granted a license if issues are not resolved. We must normalize it since the authorities are solely concerned with for the sake of investors in their country. There have been numerous reports of investors being hacked or defrauded, and it keeps happening.





Besides, investors are also feel safe if the exchange is regulated and licensed. So, in those exchanges, they need really take care of their reputation so that their project may continue to work and grow in most countries.

I understand that some countries regulations is quiet too strict but if an exchange is now having issues with multiple countries over similar problem then something is fundamentally wrong
legendary
Activity: 3808
Merit: 1723
Yes there needs to be some form of regulation. If there isn't then you got exchanges like MtGox, FTX, Gemini Earn where people put their entire life savings in and end up with nothing. What happened with FTX should of never happened but it did because there was no regulation.

I am watching their trial and they basically had fake money running the exchange for many years and they got away with it because there was no authority who could verify any of their financial obligations. Hence for mass adoption there needs to be some regulations in play so people aren't afriad of making a deposit and worry about getting all their money stolen.
legendary
Activity: 3654
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Regulation is not the thing that is a "must" or essential, it's that being legal is the thing we are going for here. When you are talking about regulations, it looks like without hardcore regulation we can't have mass adoption, that is not the case, yes that is how it will probably be and we will see a ton of people end up with something that will be crazy to handle, but that doesn't mean that it will be the way to go.

We could also have a world where it is not as hard regulations as we think and it could still end up with a good result and shouldn't shock anyone. I think low level regulations that leave it be and still be legal is the greatest thing that could happen for bitcoin and it will definitely lead to a huge adoption numbers.
sr. member
Activity: 686
Merit: 301
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If government rules accompany mass adoption, a number of other issues will arise. The constraints that will be imposed on the use of bitcoin will make it unappealing to the the general public, who will prefer to explore existing or future technologies that will make their use stress-free. I am an ambassador for bitcoin mass acceptance; but, as much as I want this adoption to happen quickly, I don't want it to turn people off from participating in bitcoin technology. Mass adoption can occur in other ways than through regulations. Adoption can also be accomplished through mass media.
hero member
Activity: 3024
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IMHO, adoption and growth correlate to each other and they happen together with the help of regulations. It's a truth and fact and all over these times, not ignoring the contribution of many through the promotion or spreading about decentralization. This is needed by the market to grow and continue moving on and that's through the help of these regulations and centralized exchanges. Even if we don't want that to be the major contributor to this growth, that's what we're seeing. We see the push from financial institutions as well aside from the centralized exchanges that we've seen to be what everyone is talking about. They may not get a license depending on their compliance but most of them are complying on it and no need to get published in media but, as much as we can see it's like every move that they do are all recorded and they're trying to move everything, price, market, etc. by every single good/bad news they make.
full member
Activity: 504
Merit: 212

The leading cryptocurrency exchange Binance which is supposed to take the lead in regulatory compliance seems to be having troubles with many countries already due to one regulatory issues to another ranging from licensing, operating within the legal framework of the country and compliance to regulation in general which have caused their exit from countries like United States, United Kingdom, Canada, Switzerland, Japan and others.

True, but Binance is trying to hide a lot of information, starting from its headquarters and ending with many reports that talk about the misuse of customer funds.

Not only binance most of the centralized exchanges are involved in this kind of activity. They are no better than FTX, they just aren't caught yet. I think the SEC is planning something for binance and they have evidence against it. The resignation of binance CEO from led me to the conclusion that he knows binance can be accused in the future and charge huge penalties.
legendary
Activity: 2688
Merit: 3983

Since 2009 till date, the industry has encountered a mouth watering growth with many institutional adoption of which Honda Motors is the latest to announce purchase of their product via crypto. Let's not also forget Elon Musk also accept payment of crypto for his Tesla cars and other big institution around the world also accept crypto as means of payment to obtain their goods.

I would like to correct this information. Honda did not accept payments in Bitcoin. Rather, the acceptance was made through a processing service that cooperates with Binance, Therefore, we cannot consider this type of acceptance, and they did not even think about buying Bitcoin.


Source ---> https://buybitcoinworldwide.com/news/honda-accepts-bitcoin/




The leading cryptocurrency exchange Binance which is supposed to take the lead in regulatory compliance seems to be having troubles with many countries already due to one regulatory issues to another ranging from licensing, operating within the legal framework of the country and compliance to regulation in general which have caused their exit from countries like United States, United Kingdom, Canada, Switzerland, Japan and others.

True, but Binance is trying to hide a lot of information, starting from its headquarters and ending with many reports that talk about the misuse of customer funds.
hero member
Activity: 2702
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Most likely. A lot of people who aren't tech-knowledgeable probably haven't even heard of crypto, let alone know about it. Regulation would help on that since the government is basically creating some laws and regulations that create a fallback for people who don't know jack about it, making it less likely to fall to a scam plus normalizing a process through a regulated exchange that the government has publicly accepted or something similar.

In the first place, a lot of people who are into crypto are investors, so they do research about what it is and how to use it. You can't exactly expect other people to do the same when they just want to use a currency, especially in this case where fiat exists and is accepted by all.
legendary
Activity: 2688
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For those people who are really new to these cryptocurrency things, they want at least to put money and be involved in crypto by only using a regulated crypto exchange. There is no doubt that being regulated is a good reference for these people as they will see the exchange as legit. If exchanges are having a hard time and issues with these regulations, it's not that we only have a few exchanges around which people can consider using.

No investors or those who just want to put money into buying Bitcoin will trust an exchange that is not regulated. It's a suicide to use these exchanges.

But take note that for mass adoption to take place, it's not just with the crypto-exchange status but there should be a push from other industries. Businesses can also play a big role in adoption by accepting crypto-payment as an example.
hero member
Activity: 1498
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Ahmmm yes it is. Because if we really want to have a mass adoption we should accept the fact that government should accept and we let them regulate the exchanges. for me, I don't want to let the government regulate it, the reason why I supported cryptocurrency because there is no government in between and there's no medium. And I don't really want a mass adoption for every country.
legendary
Activity: 2296
Merit: 2721
If same concept is applied to crypto I think it will bring in more users knowing very well that their assets are protected, less scams in the industry as KYC is used,a and  most importantly will  bring about investor confidencea and spill over to demand.
-snip-
KYC has basically nothing to do with whether an asset - crypto in this case - is regulated or not. The best example here is gold. Gold can be bought completely anonymously in many countries up to a certain amount. However, its use is regulated almost worldwide.

I completely agree with you on the rest of the paragraph, though. Regulation creates security, especially for large investors who let their clients invest in cryptos. Without these regulations, however, many investors jump or already initially shy away from investing in crypto at all.
legendary
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The refusal to be regulated by exchanges will certainly affect mass adoption in most countries of the world, because countries will not accept allowing work in cryptocurrencies without a license and without companies being subject to the regulatory laws of the country.

But, of course, it will not affect individuals’ adoption of cryptocurrencies. Basically, calls are increasing from everyone to abandon central exchanges due to successive incidents of collapse, hacking, or bankruptcy of exchanges, which led to users losing hundreds of millions of dollars.
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