Adopting a Technology-Neutral Approach to Cryptocurrency Regulation
A Ripple executive recently emphasized the importance of taking a technology-neutral approach to develop more effective and adaptable guardrails as global regulators grapple with cryptocurrency rules. The focus should be on the purpose and use of the virtual asset rather than the underlying technology to create flexible regulations that remain relevant as blockchain technology evolves.
The Challenge for Global Regulators
The unique characteristics and global portability of cryptocurrencies, with their different token types, have proven challenging for regulators. The Group of Twenty recently accepted a crypto regulatory roadmap proposed by the International Monetary Fund and the Financial Stability Board, advocating for comprehensive oversight of crypto globally.
Varied Legal Landscapes in the MENA Region
While some jurisdictions in the MENA region, like the United Arab Emirates, have taken an open stance toward cryptocurrencies, others, such as Saudi Arabia, have yet to introduce clear rules. Additionally, countries like Egypt and Morocco have completely banned Bitcoin and other cryptocurrencies altogether.
Education and Utility-Based Projects
Educating and working with regulators to help them better understand the industry is crucial. Introducing non-speculative crypto use cases, such as crypto remittances and payments, is key to navigating the varying legal landscapes in the region. According to Gupta, this approach can get regulators onboard by demonstrating real utility for usage.
Ripple’s Partnership in Africa
Given the large remittances market in Africa, Ripple announced a partnership with mobile payments provider Onafriq in November that will open new payment corridors between 27 African countries and Australia, the United Kingdom, and the Gulf Cooperation Council.
Hot Take: Prioritizing Utility Over Speculation in Cryptocurrency Regulation
The need for a technology-neutral approach to cryptocurrency regulation is evident as global regulators navigate evolving blockchain technology. Educating regulators about non-speculative crypto use cases and emphasizing real utility for usage can help them better understand the industry and develop adaptable regulations that remain relevant over time.
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