Blockchain Caucus Co-Chair: Government Needs The Ability To Reverse Transactions
As blockchain technology becomes more applicable to business and its uses continue to grow, investors are curious as to how the US will regulate crypto. Influential figures at the highest levels of the United States government are finally beginning to discuss cryptocurrencies, blockchain tech, digital assets, and how to regulate and tax those assets.
On Tuesday in a “Cryptocurrency Goes Mainstream” virtual event from Axios focused on the future of cryptocurrency policy and regulation, Democratic Representative Bill Foster from Illinois, and co-chair of the blockchain caucus stated,
You have to be able to go to a court to unmask participants under some circumstances,
I’ve just said about three things there that will drive the crypto purists berserk, like the trusted third party and so on. But in fact, there’s not a technological alternative that I’m aware of. For most people if they’re going to have a big part of their net worth tied up in crypto assets, they’re going to want to have that security blanket of a trusted third party that can solve the problem
(Crypto must be) pseudo anonymous, so the regulators can see
Crypto market cap trends low amid news of regulations | Source: Crypto Total Market Cap on TradingView.com
Representative Foster is, of course, voicing legitimate concerns for everyday investors worried about how transactions are locked into the blockchain with regard to security. Especially considering the recent uptick in ransomware attacks in the US. In that sense, safeguarding investments is of the utmost importance for blockchain technology as it continues to grow and on top of the minds of those drafting legislation on crypto.
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Foster later proposes that a court could unlock a crypto user’s identity with a guarded key of some sort. Indeed, for cryptocurrencies to become fully adopted by the mainstream, they will eventually be regulated by the governments where they operate. And in some cases, may have to be less anonymous than users would like
Yet with any decentralized financial system, the point of that system is to stay away from regulation. Let the code run itself. The US and anyone else looking to control crypto will have to strike a fine balance between regulation and the decentralized financial liberation that blockchain inherently is.
How Will This Effect Crypto Prices?
News of new regulations will always scare first-generation crypto investors. Especially since the ability to not be regulated by a single entity is one of the reasons blockchain technology was invented.
But in fact, any news is good news and more US regulation could help crypto on the whole. With more regulation, more able investors and businesses can be reached. As there are more investors in the pool, crypto prices will continue to rise with the growing new demand.
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Are Bigger Regulations Around The Corner?
Unfortunately, the answer is probably yes. As blockchain technology becomes more widely accepted and used around the world, more regulations will be put in place. Rogue operatives will certainly still be able to maneuver through countries where the technology stays unregulated, but the days of a Bitcoin wild west are over.
Keep in mind, with more regulation comes more application of the technology. With both more users and uses, the blockchain market is poised to continue growing.
Featured Photo by Casey Horner on Unsplash, chart from TradingView.com