Exchanges Changing Tune, Seeking Regulation to Mature Crypto Industry

Wed, 08/01/2018 - 10:19
Darryn Pollock
While strict regulation can scupper exchanges, as many as 88 percent of them say they would welcome regulations to help the industry mature
Exchanges Changing Tune, Seeking Regulation to Mature Crypto Industry
Cover image via U.Today

When cryptocurrency exchanges first burst into the market they had pretty much free reign as regulators and legislators did not have much of a clue about cryptocurrencies. They were also far less adopted and seen only as a pastime for those in tech and computers.

However, as things have moved on, regulators have started catching up and implementing a lot of strict rules and regulations in some part of the world- notably ChinaJapan and Korea.

This has made things harder for exchanges as they become subject to financial and banking laws, but it has also helped them build up a lot of legitimacy for those who are willing to toe the line It is that legitimization which many are craving, according to a recent survey.

Big push to be regulated

According to the survey performed by Mistertango, contrary to perception, 88 percent of crypto exchanges want industry regulation. The exchanges believe regulation is needed for the industry to mature because as it stands, nearly 33 percent fear a major market crash and sudden devaluation of assets without change.

The study was based on responses from 24 crypto exchanges across Europe, Asia, South America and Oceania, with total daily trading volumes of over $100 mln.

Despite the overwhelming call for regulations, 17 percent of the exchanges feeling that overly strict regulations are not the answer either and that they could ultimately cripple the cryptocurrency industry.

Banks and customers

For exchanges, as the middlemen, they operate with customers on one side, and banks on the other. It is because of this that exchanges, 40 percent of them, also feel that reducing the barriers to funding crypto activities by banks will improve acceptance.

Banks are one of the players in this co-operative industry that will be more at ease with a regulated space so that they can trust and work with these exchanges.

But, 33 percent of exchanges, also want to help ease this path by stating that users should be subject to Know Your Customer & Anti-Money Laundering checks like those using traditional financial services.

About the author

Darryn Pollock is an award winning  journalist from Durban, South Africa. He picked up Vodacom’s Regional Sports Journalist Award in 2017 while expanding his Blockchain and cryptocurrency reach.  He is a contributor to Forbes, Cointelegraph, Binary District, and of course, U.Today. Darryn’s belief is that Blockchain technology will be the driving force of the next technological wave and it is the obligation of journalists and writers to tell its emerging story with integrity and pride.