As we get in the new year, more regulations are starting to appear for the cryptocurrency world. According to Reuters, a director of the Central Bank of Germany said on Monday that attempts to regulate Bitcoin must be on a global scale. National and regional rules would be hard to enforce on a virtual, borderless community.
Central Bank of Germany Proposes Regulations
We are in a different world than the one 20 years ago. Things change as the years pass, and the international system is not the exception. States are not able to deal alone with different problems anymore. Cooperation in the international stage is a must.
Problems with illegal immigration have been expanding the last ten years. The climate change is now one of the ‘hot’ topics. Transnational terrorism has also been affecting several countries around the world. And nation-states are not able to control alone these things anymore.
The same is happening now with Bitcoin and the whole cryptocurrency market. If one state creates regulations, cryptocurrencies are able to avoid them by moving to another geographical space. Cryptocurrencies just need a smartphone and internet connection to work. A government by itself is not able to regulate them. It needs the help of others.
That’s what this director at the Central Bank of Germany has in mind when he talks about a global regulation for Bitcoin. Furthermore, he is also establishing the agenda for the 2018 G-20 summit in Buenos Aires, Argentina.
In an event in Frankfurt, Joachim Wuermeling said:
“Effective regulation of virtual currencies would therefore only be achievable through the greatest possible international cooperation, because the regulatory power of the nation states is obviously limited.”
G-20 Sumit – Bitcoin Regulations
The Finance Ministers of France and Germany have already called for a debate on Bitcoin and Cryptocurrencies. The G-20 summit will be the place where this topic will be discussed. The most important presidents of all over the world will be present at the meeting.
“There is no fixed definition on whether it is a currency or not (Bitcoin). This issue is a difficult one. It has not yet been proven to be credible enough to become a currency, so I need to watch for a little while more.”
The Authority on Financial Markets (AFM) warned Dutch people not to invest in Bitcoin. The same has said about Initial Coin Offerings before. Lars van den Ven, of the AFM, has commented about ICOs saying that the risks of investing in them are greater than the benefits.
It is a discussion that will be interesting to follow. Japan has been one of the countries that pushed for more cryptocurrency adoption. It has recognized Bitcoin as a means of payment and has allowed several exchanges to operate on its territory. Besides that, Japan has benefited from Bitcoin and increased its GDP by 0.3%.
Image Courtesy of Pixabay
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