Cryptocurrencies have evolved over the last few years. In 2017, Bitcoin was able to jump from around $1,000 to near $20,000 which allowed the digital asset to catch the attention of investors and regulators. Investors took an interest in participating in the market hoping to earn some profits due to the volatility of cryptocurrencies. But also, regulators decided to take a closer look at the industry. Regulators decided that it’s time to formalize the market considering the size that it has grown into last year.
Unfortunately, though, different regulators from different parts of the world have different approaches. There are countries that fostered cryptos while there are countries that did the complete opposite.
For Ripple CEO Brad Garlinghouse, as he was attending the Singapore Fintech Festival along with IMF Deputy General Counsel Ross Leckow, he said that regulatory clarity is key towards improving adoption of cryptocurrencies. According to Garlinghouse, “Regulatory clarity has a huge ability to drive digital asset and blockchain adoption. It is surprising how many markets still have uncertainty. But, in ASEAN, the regulatory environment for blockchain and digital asset technology is clearer”.
ASEAN Being More Open to Cryptos?
Countries such as Thailand, Singapore, and the Philippines are providing subtle improvements that will cater to blockchain and the crypto industry. He even discussed how Thailand has managed to balance not only innovation but also consumer protection. It has also been reported that Ripple is looking to target the Philippines in order to lessen the cost of cross-border transactions. A large chunk of the Philippines’ economy comes from the remittances of Filipino workers abroad.
As for Leckow, he described the ASEAN region to be more open to fintech. He mentioned that “Every country in this region also has very different needs. Some are further ahead than others in thinking through policy, and it’s not surprising that they’ve taken different regulatory approaches”. He also added that “But, in the ASEAN region, there is general openness in embracing Fintech and allowing innovation to happen. Fintechs in this region are willing to engage with regulators and let them understand the technology, services and products that they’re producing in the early stages of development. Regulatory sandboxes in Singapore, Malaysia, Thailand, and Indonesia are examples of this”.
Regulatory Difficulties Around the World
Regulatory clarity isn’t exactly something that happens overnight. There are countries that are more welcoming to cryptos while there are countries that are the complete opposite. China, for instance, decided to ban crypto related activities by stopping the operation of crypto exchanges. In essence, this was the same move made by India as its central bank ordered banks to stop providing services to crypto related businesses.
In the US, the US Securities and Exchange Commission may have rejected Bitcoin ETF applications citing the possibility of price manipulation, but there is that one Bitcoin ETF application that is said to have a strong chance of getting approved. The Bitcoin ETF application by Solid X and VanEck could potentially attract institutional investors if it gets approved. This has the possibility of bringing in billions of fresh capital into the crypto market as it becomes easier for institutional investors to invest in Bitcoin.