Regulations will be “great” for cryptocurrency
Cryptocurrency prices were struggling in March as the threat of more stringent regulations were looming.
Legislators threatened tighter restrictions on cryptocurrencies.
But according to crypto expert, Galia Benartzi, regulations are “great” for the digital currencies.
Stricter rules help to legitimize digital assets trading and create certainty for investors.
Benartzi warned that a lack of regulation could deter entrepreneurs from entering the market.
The Bancor co-founder told CNBC:
“We actually see increased regulation as a great thing.
“The challenge for entrepreneurs is the lack of regulation. Because if the market is uncertain and you don’t know exactly how to operate – you’re much less free to build the innovation that you’d like to see.
“So increased regulation is welcome.”
The well-respected crypto expert said there should be discussions with legislators on building the right regulations.
Ms. Benartzi praised the industry’s efforts to stop scams on the crypto market throughs attempts to self-regulate, saying:
“We all know that that’s good for the industry, good for the projects and good for the space.
“And I think another really exciting thing about the accessibility of cryptocurrencies to the masses, to the public, is accountability.”
A rough first quarter
It saw record highs in December when it shot to a monumental price of just under $20,000.
Prices slumped following the news on Thursday that India’s central bank Reserve Bank of India (RBI) announced plans to ban financial firms from providing services for companies dealing with cryptocurrency.
The bank said in a statement:
“Virtual currencies (VCs), also variously referred to as cryptocurrencies or crypto assets, raise concerns of consumer protection, market integrity and money laundering among others.”
BP Kanungo, RBI’s deputy governor, said:
“To ring-fence the RBI banks from the risk of dealing with entities associated with virtual currencies, they are required to stop having business relations with the entities dealing in virtual currencies forthwith.
“They are also required to unwind the existing relationships in three months.”
Mark Carney, the Bank of England’s Governor, has been highly critical of cryptocurrencies.
He described being part of the financial system as a “privilege” and that “responsibilities come with those privileges.”
Mr. Carney added:
“The best of the cryptocurrencies, I would suggest, will gravitate to the best of the exchanges if they were regulated.
“And others will fall by the wayside.
“In the end, it is not just about market regulation, part of this is about any money laundering, terrorism financing, other illicit activities.”
Shortly before this years G20 summit, however, Mr. Carney revealed cryptocurrencies do not pose a risk to financial stability.