Cryptocurrency is an intriguing innovation with complexities that yet require ironing. However, the trend is here to stay, which implies proper governing attention by the authorities.
Financial stalwarts, traditional like columbia bank Colonia and otherwise, maintain their distance from the volatility of cryptocurrency. Nevertheless, they do appreciate the potential of this rising innovation.
Often, initial regulations tend to get suffocating, especially where cryptocurrency is concerned. Here are a few ways to regulate the fickle assets called cryptocurrency.
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- Establishing the tax situation
Bitcoins and blockchains are ultimately about making profits through their fixed values. Profits, in turn, imply taxes, which should fall under a regulatory and specified tax system. The authorities need to make clear their stance on the cryptocurrency tax application and under which situations it applies.
- Regulate specific exchanges
Cryptocurrency may take on a visage of usual physical cash under specific conditions but, as an asset, it requires regulation in exchanges. Illicit behavior and practices may run rampant without necessary exchange protocols in place.
Traditional banks calculate the unwanted risks of dealing with cryptocurrencies as a negating factor to their overall economy. The central solution would be opening up exchange accounts for time-established financial institutions to follow suit.
- Start frame-working ICOs
Cryptocurrency is a realm rife with scams and high-potential risks. Yet, there are always new contenders looking to launch their Initial Coin Offering (ICO) businesses. ICOs do not have any standard framework that establishes their credibility or authenticity.
It may seem like a scam run by virtual operators with no rules determining what works and under what circumstances. Asking the authorities to regulate every possible ICO is demanding. However, a fundamental framework can serve as the stepping stone.
Cryptocurrency can be challenging to navigate, especially with multiple unclear aspects of revenue and investment in play. The field itself lacks many professionals running the operations. Any investments made must get scrutinized for risk security and financial stability before their purchase.