Crypto Regulation Quotes

Cryptocurrencies are vulnerable to hacking and theft. When you have fiat money in a government regulated bank account, you have some authority to help you solve a problem like that. With crypto, you're all alone and out of luck.

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Cryptocurrency, which was supposedly created as a solution to the myriad failures of our regulated financial system laid bare during the subprime crisis, had effectively reproduced and even amplified the same dynamics, leading to a similar implosion. Thankfully for the broader public, it had all happened on a smaller scale and the real banks were not involved (despite the crypto industry’s efforts to the contrary). But once again, it was regular people who were left holding the bag.

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As of today, the majority of Asian countries are still examining crypto technology and drafting their regulatory outlines. Better crypto tax regulations should come in the next few months or a year from now. Now, we can settle the argument on crypto taxation laws enforcement. It is very certain that it is just a matter of time for this event to unfold, collecting capital gains tax is just a time bomb waiting to explode in the cryptocurrency space, or else, the government will place outright ban on these commodities.

Banks were once an extremely valuable part of the economy and did a lot of good in advancing civilization. Banks played a pivotal role in financing big projects like roads, bridges, factories, stadiums, etc. Banks were to the economy what the heart is to the human body. But that has ended. Traditional banks have become extra toxic entities in the economy. It’s partially the fault of excessive government regulations that have made everything dysfunctional and it’s partially the fault of greedy bankers putting profits above customers and shareholders above society... But nonetheless, banks today offer very little benefit to their clients. They pay barely anything in interest. They offer barely anything in growth. They move money too slowly. They’re too restrictive. They’re selling the same boring products and services they did a hundred years ago. And they have too much power over peoples accounts. Soon, the many new companies and applications that emerge on the Ethereum infrastructure will eliminate the need for traditional banks and eliminate their value proposition by providing people with superior value. Everything from growth to asset management to lending can be done even better on the Ethereum infrastructure by anyone.

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The new crypto exchanges had no regulators. They acted as both exchange and custodian: they didn’t just enable you to buy bitcoin but also housed the bitcoin you’d bought. The whole thing was odd: these people joined together by their fear of trust erected a parallel financial system that required more trust from its users than did the traditional financial system. Outside the law, and often hostile to it, they discovered many ways to run afoul of it. Crypto exchanges routinely misplaced or lost their customers’ money. Crypto exchanges routinely faked trading data to make it seem as though far more trading had occurred on them than actually had. Crypto exchanges fell prey to hackers, or to random rogue traders who gamed the exchanges’ risk management.

We tried having some grown-ups, but they didn’t do anything,” he said. “This was true for everyone over the age of forty-five. All they did was worry. Here’s a classic grown-up thing: you freak the fuck out about a Chinese government crackdown on crypto in Hong Kong. Their job was to be serious about problems even if the problems were not serious. And they weren’t able to identify serious problems. They were terrified of regulators. Or taxes! Not that we wouldn’t pay it, but we’d pay too much, and then we’d have a loss the next year, but we’d already paid our taxes.

Regulation requires more surveillance and those at the top will always have loopholes at their disposal. Regulation is not just a tool for the state to dampen the most extreme exploitation, but also a handy legitimization tactic for capitalist organizations to further entrench their power.

Wash trading, as it was called, would have been illegal on a regulated US exchange, though the sight of it did not bother Sam all that much. He thought it was sort of funny just how brazenly many of the Asian exchanges did it. In the summer of 2019, FTX created and published a daily analysis of the activity on other exchanges. It estimated that 80 percent or more of the volume on the second- and third-tier exchanges, and 30 percent of the volume on the top few exchanges, was fake. Soon after FTX published its first analysis of crypto trading activity, one exchange called and said, We’re firing our wash trading team. Give us a week and the volumes will be real. The top exchanges expressed relief, and gratitude for the analysis, as, until then, lots of people assumed that far more than 30 percent of their volume was fake. Sam was less surprised that Binance was wash trading than by how badly they were doing it. “They were doing a B-minus job at market manipulation,” he said. One Binance bot would make a wide market in Bitcoin futures, and another Binance bot would enter and lift its high offer. If, to keep the numbers simple, the fair value of bitcoin was $100, the first Binance bot would insert a bid at $98 and an offer at $102. No normal trader would trade against either—why sell for $98 or buy for $102 on Binance what you could buy or sell on some other exchange for $100? But then, at regular and predictable intervals, the second Binance bot would enter the market and buy at $102. It looked as if a trade had occurred between two different parties, but it hadn’t. It was simply Binance buying from Binance.

A specter is haunting the modern world, the specter of crypto anarchy. Computer technology is on the verge of providing the ability for individuals and groups to communicate and interact with each other in a totally anonymous manner. Two persons may exchange messages, conduct business, and negotiate electronic contracts without ever knowing the true name, or legal identity, of the other. Interactions over networks will be untraceable, via extensive rerouting of encrypted packets and tamper-proof boxes which implement cryptographic protocols with nearly perfect assurance against any tampering. Reputations will be of central importance, far more important in dealings than even the credit ratings of today. These developments will alter completely the nature of government regulation, the ability to tax and control economic interactions, the ability to keep information secret, and will even alter the nature of trust and reputation.

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The fallacy of Libra, and of cryptocurrency plans in general, is that the problem isn’t that we need a new technology. We know how to move numbers on a computer. The problems with Libra were always going to be regulation — especially when the project came from Facebook. Crypto dreams are tolerated when they’re put forward by weird small-time nutters — but not when they’re coming from a huge company with a continent-sized user base. But, even though every single thing about Libra went wrong, Facebook doesn’t take “no” or “never” for an answer.

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