Until today, Bitcoin has been struggling to keep things up. In fact, since 2018, Bitcoin has been struggling. Mainly because of regulatory changes, adoption didn’t happen last year. In addition to this, the promise of institutional investors playing a role in the industry also didn’t come into fruition. Though there are institutional investors that have decided to participate, most of these institutional investors never went all in especially now that Bitcoin is only trading at around $3,500.
But despite the bearish market for over 12 months, Marcus Hughes who is UK lead counsel for Coinbase predicts that this year is going to be a big year for the crypto market as a whole. In particular, he believes that there will be regulatory clarity soon. He mentioned that “Within the next year or two, we’ll see big developments”. He even added that “Regulation will take shape this year, particularly in Europe”.
Regulatory Clarity in Europe?
In the UK, the country’s Financial Conduct Authority which is the agency that is in charge of overseeing the banking industry, is set to have a consultation that could ban the sale of derivatives based on digital assets like Bitcoin. In addition to this, just last month, the UK government is ready to empower the agency in overseeing cryptocurrencies as well.
Nicky Morgan has his two cents regarding the possibility that the FCA is going to be in charge of regulating cryptocurrencies in the UK. Nicky Morgan chairs the Treasury select committee group of British lawmakers. He said that “It is clear that the government and the FCA share the committee’s concerns on crypto-assets, including the lack of regulation, minimal consumer protection and anonymity aiding money laundering”.
As for the European Banking Authority, the agency is already calling for a standardized approach in crypto regulation in the European Union. However, the EBA is also looking to protect those Bitcoin and crypto investors.
For Hughes, there is a possibility that each country in Europe can have their own approach in crypto regulation but there is also that hope that Europe will have a unified approach. Hughes thinks that “It would make life for companies like Coinbase a lot easier”.
Bitcoin is Here to Stay?
Hughes joined Morgan Stanley in 2009 during the financial crisis. He decided to enter the crypto market during the bear market. Hughes mentioned that Morgan Stanley now thinks that “Bitcoin and cryptocurrency does now have staying power. They don’t expect it to go away any time soon”.
Bitcoin ETFs until today haven’t been approved. In fact, regulators in the US fear that there could possibly be price manipulation in the market. SEC Chair Jay Clayton addressed the agency’s concerns a few months back saying that the agency is only going to be comfortable approving a Bitcoin ETF only if crypto exchanges have the right surveillance tools.
Right now, many are already thinking that even VanEck’s Bitcoin ETF application is to be rejected soon because of this. As for Europe, could it be possible that they implement a unified rule for different countries? This isn’t the first time that there’s a call for a unified crypto regulation.