Crypto and the New World Order
2019 was quite the rollercoaster ride for cryptocurrency regulation, and let’s be honest, the entire world became a bit of a soap opera, with tweets, major organizations, and political tensions all playing starring roles. From President Trump’s delicate touch on Twitter to the stark regulatory maneuvers of various nations, it was clear that the realm of crypto had ascended beyond legal jargon and into the heated arena of global politics. And while I personally have my inner lawyer fretting about the situation, the drama is undeniably captivating.
The Insiders: Who’s in Charge?
At the heart of this theatrical performance are the “Insiders” — primarily the U.S., Japan, and Western Europe. This trio has masterfully maintained their dominance since the post-World War II financial orchestration. The Organization for Economic Co-operation and Development (OECD), born in 1948, did a significant amount of heavy lifting to refine the financial infrastructure that keeps the global train on the tracks.
- Their treasure map? One filled with regulations and standards designed to keep the world’s funds flowing in their favor.
- The Financial Action Task Force (FATF) quickly turned into a sort of gatekeeper, categorizing countries based on their risk levels.
In essence, “high-risk” nations found themselves on a list that, much like a harsh report card, could lead to fewer investments and much less economic development.
The Crypto Tides: Threats and Opportunities
Despite the comfy seats the Insiders have at the financial table, cryptocurrencies pose no shortage of challenges. Think of them as party crashers at a high-stakes gala. For instance:
- Emerging institutions and networks defying the status quo.
- Fiat currencies, particularly the U.S. dollar, facing competition from the likes of Bitcoin and stablecoins.
Perhaps that’s why guys like U.S. Rep. Brad Sherman have started to sound the alarm bells, suggesting cryptocurrencies could ultimately shake the foundations our financial systems were built upon.
The Experimenters: The Pragmatic Players
On the flip side, we have the “Experimenters” – countries like Singapore and Switzerland that are straddling the delicate balance between embracing innovation and adhering to regulatory frameworks. Rather like those clever students who know how to manipulate their school’s rules to their advantage without actually breaking them.
- These nations are using their savvy understanding of both crypto and conventional finance to carve out lucrative niches.
- They demonstrate that in the world of crypto, pragmatism can win the day, unlike that one kid in class who abides strictly by the rules — we’ve all met him.
Libra and the Furry Backlash
If the Insiders were skittish about crypto before, the advent of Facebook’s Libra struck pure panic into the hearts of many. Suddenly it wasn’t just Bitcoin and Ethereum shaking things up, but a potentially unfettered banking system aiming to unlock capital in regions deemed too high-risk by traditional banks.
The backlash was instantaneous and severe, leading the U.S. and EU down a path of almost unanimous disapproval, unlike any bipartisan cooperation we typically see. In the end, while the Insiders panicked, the developing world seemed much more intrigued, inviting all sorts of questions about who really holds the power.
Japan: The Trailblazer
Enter Japan, the overachiever of the crypto classroom. Having regulated cryptocurrency businesses since 2017, they’ve been taking notes while others were busy daydreaming:
- In 2019, Japan matured its regulations, establishing guidelines for margin trading and initiating licensing for custodial services.
- Now facing the Travel Rule, their response is like a well-studied exam answer — likely straightforward compliance with sufficient KYC measures.
With all this in mind, it’s fascinating to see how the geo-financial landscape is evolving as we journey forward, especially with the Outsiders like China and Russia lined up for their turn in this thrilling saga.
