Regulation
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The bankruptcy of the FTX cryptocurrency exchange forced many states to tighten control over the blockchain industry. The regulation of the digital asset market creates conditions not only for increasing its transparency and security, but also accelerates the entry of institutional capital into the cryptosphere, according to a Bank of America report.
If now investment funds mainly use cryptocurrencies for financial speculation, then the legalization of the industry will make it more mature, and bitcoin and other virtual assets will be more widely used in the real economy.
The authors of the report, Alkesh Shah and Andrew Moss, emphasized that the collapse of the FTX exchange and the subsequent market turbulence has intensified international cooperation in the field of controlling the circulation of digital currencies.
The bank’s analysts’ report states:
The collapse of FTX has focused the attention of countries on the regulation of the industry. Creating a transparent legal framework for digital assets promotes technological innovation and protects consumers and investors, as well as reduces risks to financial stability.
Bank of America recalls that in 2022 the value of the 100 largest digital currencies collapsed by almost 65%. However, since the end of 2016, these same coins have skyrocketed in price by 2175%.
Developers of decentralized applications (DApps) have also stepped up this year.
Moreover, such blockchain services have become more often used not only for buying and selling virtual currencies, but also for other purposes, for example, paying for goods and services.
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