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by MadeThisToReply
1460 days ago
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The whole point of crypto is that it's not regulated. As soon as the regulators take real action on crypto, the entire promise of crypto will vanish in a puff of smoke. I'm not saying that's a bad thing, but I struggle to envision what a tightly-regulated crypto market would look like that wouldn't defy the entire point of crypto. |
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I think that regulations would come in the form of how so-called stablecoins and their owner companies can operate, how other companies (exchanges, etc.) can operate, and so on.
Take stablecoins - one might regulate these with hard requirements of how many % of their backing are in extremely liquid assets. Take tether - the idea is that it should be backed 1-to-1 with USD. Of course, that is not the case, at all. The owners have said that it's not backed at such ratio.
With extremely opaque stablecoins, you really have no idea what they're backed by. Imagine if stablecoin xyz said "We're 99.99% backed by [some currency]!" but then it turns out that they're backed 5% by said currency, and the rest has been put on the stock market - because the owners figured they could get filthy rich by betting all that money on low-risk stocks. Works until it doesn't work, and then people do a run on the coin.
So, regular audits, full transparency, hard regulations around what they can or can't do. That alone will probably flush out the majority of fly-by-night scams.
I think it is understood that most people are in it for huge and quick gains. Some crytpo fundamentalists will say that they're in it "for the tech", but I would be very, very surprised if that was the case for majority of crypto holders. So you are right - a regulated crypto space will probably drive out many of the speculators and gamblers, but I think that's OK. In the end there's a need for cheap and efficient cross-boarder payments, without having massive companies as middle-men. But to achieve true mainstream adaption, that will come at costs. The wild-west days are closing up.