Experts predict that if the blockchain industry is able to move beyond the current phase of speculation and volatility, and build more institutional structures, crypto assets have the potential to play a pivotal role in the future of finance.?
Experts predict that if the blockchain industry is able to move beyond the current phase of speculation and volatility, and build more institutional structures, crypto assets have the potential to play a pivotal role in the future of finance.
Recently,National Development and Reform Commission in China issued the “Guidance Catalogue for Industrial Structure Adjustment (2019, Draft for Soliciting Opinions)”, which provides guidance on the adjustment of existing industrial structure from three categories: encouraged, restricted, and eliminated. Among them, “big data, cloud computing, information technology services and blockchain information services within scope of the state” are listed in the encouraged projects.
“Blockchain information service within scope of the state” reveals several core information. On the one hand, blockchain technology is an indispensable part of regulatory technology, such as smart contracts, intelligent regulatory reports, etc., which will be further developed and used as a tool to build trust mechanisms. Currently, local governments and technology companies are investing in blockchain, which is believed to be used for health care, remittances, micropayment, and identity management. On the other hand, blockchain is very cautious as core technologies for supporting cryptocurrencies. Therefore, it is only within scope of the state. This means that“blockchain information service” associated with cryptocurrencies is regulated by the state.
Cryptocurrency is the target of regulation
Phil Cotter, managing director, risk business at Refinitiv, believes that key to the crypto space going mainstream will be efforts by regulators to supervise the industry without stifling experimentation. So far, the industry has largely defied international coordination.This has led to an array of different approaches by national governments. Attitudes in Asia to the crypto sphere run the gamut, from self-regulation in Japan to authorities taking a dimmer view in places like China.
Encrypted assets will be “transparent”
Phil Cotter also stresses that the crypto industry must become more institutionalized to mitigate market as well as financial crime risks and build trust in the sector. New international standards and increased regulatory scrutiny in 2019 are expected to provide a more transparent framework for crypto assets to operate.
Cryptocurrencies and other crypto products are destined to come under greater regulatory scrutiny, but this can only be a positive step for an industry that has been extremely volatile. To move beyond speculation, crypto assets need to become more institutionalized, trusted and accessible, and?regulators will play a key role.
This article is originally created by UU.Block. If reproduced, please indicate the source.
If reproduced, please indicate the source: https://www.uucj.net/entropy-of-cryptocurrency/