There are certain reasons why we think the crypto market must suffice with serious regulations. Here are five reasons why.
Prevent Market Manipulation and Protecting Investors: Imagine a news going viral about tokenX which will rise by 6% in the next 24 hours? There are possibilities that investors may start investing in tokenX rigorously. Now the next day the token gets dumped in the market, creating a Pump and Dump situation. Scenarios like these will create a gap between the users and regulators.
Allowing Selected Cryptocurrencies: Even when Bitcoin and Ethereum are on a downfall the crypto market is welcoming cryptocurrencies every now and then. The crypto market is expanding every day with a huge number of 20,833 crypto currencies on 2nd, Sept, 2022. With such a number it gets difficult to administer every currency. And undoubtedly, the crypto market has seen various cases of ‘pump and dump’, or digital assets going to zero in hours. These cases not only create a window for cybercriminals but also create associated complexities.
Advancing Technology Concerns: The crypto currency is completely backed by the tech industry, from creation to distribution. The technology is advancing everyday introducing new aspects to the crypto industry. Whether it’s the mining machines or the security bots. But, with enhancing tech, comes a gap for the bad actors to create a disruption and nuisance in the market.
Online Fraud and Cyber Security Risks: If you’re a crypto geek or planning to step-in you may know about the Mt GOX case. Mt Gox was the world’s largest crypto exchange in 2010, handling approximately 70% of all the Bitcoin transactions in the world. But hackers got through the security patches and cleared Bitcoin worth 8.5 Million USD. This was only the beginning, amid the hack a lot of instances have taken place in the last decade. One such case happened in North Korea, where Group of hackers cleared cryptocurrency worth 2.5 Billion USD.
Money Laundering: This stands to be one of the most known cyber crime activities in funding criminal activities. There have been several cases in the past where the hackers have littered cryptocurrencies and converted them through virtual currency mixers. The process can be termed as the most poisonous for the crypto industry.
Crypto currency market is filled with such activities which need to be stopped. The only way to do this is to regulate the complete industry. Many government authorities have started to regulate crypto activities and crypto based transactions and serve the user’s safety. This has always been a crucial topic and surely it must be implemented to make crypto a better place for investors.