The idea of regulated cryptocurrency can be oxymoronic. However, the arising concerns around the decentralized feature of crypto have been arising around the globe. Recently, Iran’s government deemed the crypto market riskier and more confusing than ever before. The statement followed a proposal produced in the parliament to include crypto in the country’s existing “currency smuggling” and foreign currency exchange regulations. Even though the regulations pose an important role in preventing users, they also may be a threat to innovation.
According to CipherTrace’s Chief Executive Officer [CEO], David Jevans it will always be a struggle finding the balance between regulations and innovation. In an exclusive interview with AMBCrypto, Jevans said:
“As a society, we will always be striving to achieve the perfect balance between regulations that protect individuals and businesses without enacting so many restrictions that innovation is unable to thrive.”
However, companies like CipherTrace has been working along with the Financial Action Task Force [FATF] and other organizations to ensure the core values of cryptocurrencies are retained as regulations are enacted. The focus has mainly been on preventing the illicit use of cryptocurrencies like in funding weapons, human trafficking, and money laundering. However, there have been countries that have outrightly banned the use of crypto, focusing mainly on Bitcoin, like, Bolivia, Columbia, and Ecuador. Despite being around for over a decade, Bitcoin has been unable to secure trust from the government regarding its use-cases.
As we move towards a regulated structure of the crypto world, privacy becomes an important pillar. Jevans opined that we may see the adoption of privacy-enhancing features by pseudonymous tokens and blockchains as seen with Bitcoin, Ethereum, and Decred. The reason for such speculation was due to the upcoming launch of not one but multiple Centrally backed digital currencies [CBDCs]. Jevans concluded:
“As more nations issue central bank digital currencies, CBDCs, the privacy of those transactions will be of great concern to consumers and businesses in those countries. Such a digital currency could provide repressive regimes unprecedented real-time access to the financial activities of their citizens.”