The regulation of Bitcoin is simple in theory yet incredibly complex in reality

Regulators have struggled to reach a consensus, to stay in contact and establish a working relationship with crypto-currencies, because these digital currencies are becoming more important. The idea is simple, but the implementation is much more difficult due to the quasi-anonymous digital currency.

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A problem of traceability

The world’s regulators have not yet decided on a consistent approach. Some countries take a direct route, such as China, and are attempting to put in place prohibitions that are not as effective as they would like. Others, such as Switzerland, are adopting the digital currency, in the hope of attracting more investors to the technology Blockchain. But adjust the crypto-currencies should be fairly simple, in theory. After all, unlike the silver trust, which can be transferred without any registration, crypto-currencies leave a digital footprint. This footprint is not as simple to follow as a bank transfer, for example, but it is not impossible.

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Regulators floundering

Professor Andrei Kirilenko, director of the Centre for global finance and technology at Imperial College London, believes that by their very nature, crypto-currencies have a tracking system built-in, but people sometimes hide their identity in various ways. He believes that if the transactions of virtual currencies were regulated so as to compel the transparency, the crypto-currency would not be more difficult to regulate and deal with the bank transfers. Of course, it is unlikely that users would accept such a regulation without protest.

The regulation may seem to be a dirty word in the community of Bitcoin, but smarter regulation will increase the adoption. Regulation is unavoidable, and an appropriate legal status will allow the Bitcoin to align on the monetary systems existing and to stimulate the investment of the financial actors in the traditional sense.

Source : Cointelegraph