Bitcoin emerged a decade ago as a viable alternative to money, and has since then (especially recently) gained major traction. However, the the world's 2 biggest economies are not too happy with it. And while both the US and China have begun to implement regulations of cryptocurrencies, they are also in the process of developing their own digital currencies centrally as well.
Cryptocurrencies are traded online, away from the control of governments, central banks and institutions of the global financial system. For this reason, China has banned all use of it, claiming that it used by criminals. The US also claims that it is important that the Fed is able to deliver a stable and trustworthy currency to its people, and bitcoin acts as a barrier in that. They also claim that while innovation is very important, where the public is concerned the government has to step in and enforce some sort of regulation.
However, some countries are embracing the cryptocurrency. El Salvador declared Bitcoin as a legal currency, and Ukraine followed suit. Cuba, Malta, Singapore and Switzerland are all also becoming more open to the idea of a virtual currency, and trying to create a business environment where crypto is able to grow.
4 comments:
This is a very unique question, as the whole purpose of Bitcoin is essentially to have and uncontrolled and unregulated currency that is universally used and available. Even if a government wanted to regulate it, the only way to do so is to not accept it and try to limit its access, which is almost impossible. China has "Banned" Bitcoin, but rest assured there are ways around it and people will still continue to use it, whether the government wants people to or not.
Cryptocurrency is a tricky situation because there will always be a way around government regulations since it is completely online. I think that its important that all currency is regulated by the government, especially for crime control. I think that the pandemic proved that society is moving more towards electronic forms of payment, however cryptocurrency might be too far.
Even if a lot of countries are adapting to crypto currency it won't really have an effect till the rest of the world, especially the bigger economies, start adapting to it as well. With that being said, crypto currency can be regulated whoever it can go against economic freedom.
As Eric said above, it is virtually impossible to ban anything. In the United States, most everything that is banned for legal sale, drugs, certain weapons, etc. are still available on the black market. From my own experience (on a much lower scale), banning anything from individuals often makes them want it more. People will always find ways to access things that they want even if it's illegal to get. I suspect that as Bitcoin "matures" and stabilizes, it will eventually be accepted as a form of currency. Twenty years ago the thought of having an online form of payment and money was absurd. However, Venmo and online banking is very prominent. It may seem like Bitcoin is a thing that is for the future, but it may be closer in the future than most think. Once it is accepted as currency, it will likely be regulated.
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