The past week saw a lot of progress made by the authorities in relation to Bitcoin and cryptocurrencies. Libra announcement by Facebook last month gave the impetus to Governments all around the world to finally take immediate notice of the matter.
Bitcoin began a new age of digital asset which is not yet defined by the laws of Governments. Cryptocurrencies could be regulated as an asset, commodity, currency or even financial security in some cases. Subsequently, after Bitcoin’s popularity began to increase a lot of ‘other Bitcoin’ or altcoins were released. This made matters worse for the authorities trying to regulate these new asset types.
The total market capitalization of the cryptocurrency markets is close to $290 billion. Over the past decade, it has been exploited for a number of illicit activities. However, the benefits and the belief around cryptocurrency, especially Bitcoin, is starting to outweigh the flaws.
The United States of America and China are two of the world’s biggest economies and the biggest contributors to the crypto-market. China with its mining ecosystem, and the US with its projects and investors.
The Governments of both these countries including India for long have tried to curb the illicit activities around cryptocurrencies through warnings. However, this week they made progress in promoting it.
The US Senate Holds Discussions on Libra, Bitcoin, and Crypto
The US Senate Hearing on the 16th and 17th of July marked a historic moment for Bitcoin and cryptocurrencies. Two Houses of the US Senate – The Banking, Housing, and Urban Affairs Committee and the Financial Committee addressed the issue profoundly.
While it did not end well for Facebook’s plans, it was a big win for Bitcoin and some cryptocurrencies. Both the committees ‘grilled’ Facebook’s head over their plans. They seemed to be in agreement to disapprove it.
Nevertheless, David Marcus, the head of the Libra Association and Facebook’s representative at the hearing was still optimistic. He suggested that the announcement was made prior to the launch to address these concerns at their very best.
The positives for crypto-markets involved a strong understanding of cryptocurrencies. Also, a number of US Congressmen and women who were recognized were actually in favor of cryptocurrency. Senator Patrick McHenry concluded the session by saying,
Due to the nature of the technology of Bitcoin, Governments cannot kill it, nor should they and you can’t kill digital currencies broadly.
Anthony Pompliano, the founder of Morgan Creek digital noted about the politics of the country, he tweeted,
Facebook is forcing the Bitcoiners in positions of government power to self-identify themselves. Don’t be surprised if this becomes one of the hottest topics for 2020 elections.
China Recognizes Bitcoin Legally
China has been so strict with cryptocurrencies, that many around the world believe that Bitcoin is illegal in China. China for long has cracked down on cryptocurrency by banning online Exchanges. Recently, it also planned to prohibit the mining activities in the country.
In the first-ever property infringement case relating to Bitcoin in the country. China’s Hangzhou Internet Court recognized Bitcoin as a legal ‘virtual property.‘ Therefore, it confirms that investing in Bitcoin is not illegal in China.
Many reports over the years have suggested that China dominates the mining industry in the world. Moreover, OTC desks have also prevalent in the country along with peer-to-peer exchange on WeChat since the Exchange ban was imposed.
India: Ban or no Ban?
The case of India is similar to that in China. In India, as well, Bitcoin and cryptocurrency Exchanges are practically non-existent. Moreover, there is a strong dislike for it in the higher-ups. However, recent revelations suggest otherwise.
India, for long, has opposed the idea of Bitcoin and cryptocurrency. Reports of complete ban and imprisonment up to 10 years have created a lot of apprehensions in the citizen. Moreover, apparently, the Government is also trying to implement its own central bank digital currency on the blockchain.
Nevertheless, the recent parliamentary Q and A session with the members of the Finance Minister and other lawmakers, it was revealed that ‘work is still in progress.’ Hence, it confirmed that no ban has been imposed for now.
Last but not least, G7 Cryptocurrency Task Force, currently headed by France is broadly assessing the laws pertaining to cryptocurrencies. The Task Force is specifically looking at the possible impacts and implications of Libra. However, such discussions provide a platform for discussion and clarity around things.
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Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com