Ever since Bitcoin and several other cryptocurrencies made their debut there have been mixed emotions about them all over the world. Some have deemed it to be a great replacement to the fiat, some call it digital gold, whereas some of the people have taken a pretty harsh stance against the digital currencies. No doubt cryptocurrencies provide a better way of carrying out monetary transactions, and keep the record of these transactions utterly tamper proof, but there are a number of reasons for the masses to not adopt cryptocurrencies to utilize them to make their everyday payments and transactions.
Following the price hike of Bitcoin in late 2017, the digital currency’s value started declining. The price dropped down almost more than half of the value that it had attained and its price continues to fluctuate, displaying high volatility. This makes cryptocurrency an extremely unstable asset, and the high volatility has scared away most of the investors and miners for the time it could not produce any profit. There are many who do not trust the technology yet, as the image of cryptocurrencies has been thoroughly tainted by the scams that keep erupting in the space.
Blockchain and cryptocurrencies still being just over a decade old, call for new rules and regulations to be introduced to govern the trade of the digital assets. Owing to the fact that this new technology is essentially uncharted and unfamiliar territory for the government they have failed to produce a regulatory framework as of yet. However this is just one of the reasons. Recently, BlockPublisher got in touch with Caleb Chen, a digital currency advocate at Private Internet Access, who shed some light on the subject. He told:
There are definitely elements in/of every government that are firmly anti-decentralization by their nature.
The governments may have not been so welcoming to the cryptocurrencies, as they in one way do deprive them of the control they hold over the economic situation of a country, however there are multiple countries where blockchain based projects are being employed to replace the older versions due to a number of advantageous aspects it holds. Caleb added on:
Governments are still waiting for a solid “example” regulatory framework to magically appear. Smaller countries and state entities have been most willing to experiment with this new technology and give it a chance. There are examples of overly restrictive regulatory frameworks, such as the BitLicense from NY, and there are examples of more considerate frameworks such as those in Bermuda. Once these smaller countries have succeeded, larger countries will draft better and better regulatory frameworks… theoretically. The danger is if a large country or financial entity takes a hard negative stance. But nowadays, even they have opened up to the “underlying” blockchain technology because even centralized entities can benefit from the advance of decentralized technology.
While many of us speculate, when the governments will be able to provide a regulatory framework for cryptocurrencies, the technology still in its infancy has a number of features that many have yet to completely comprehend. Such a technology is naturally complicated for the government to understand. There is a need for them to be educated intensively about it if they are to regulate cryptocurrencies. Until that comes to pass, it is not very likely that cryptocurrencies will receive global adoption and finally shed their association with criminal activity.