Block chain security consulting firm warp future , said: Since the introduction of digital assets, they are being closely watched global retail and institutional investors, and achieved significant milestones applications. Although regulators around the world are still improving laws on digital assets, they have taken different approaches and have made the above progress.
The increasing popularity of digital assets as an investment and trading tool has paved the way for more and more exchanges worldwide. In addition to exchanges, there are also many platforms that promote the development of digital assets, such as digital wallets. Although mainstream people are increasingly adopting blockchain-driven assets, regulation is still catching up.
Regulatory barriers vary from country to country
Due to the lack of national regulations, standardization and large-scale adoption are still greatly hindered. Some countries are establishing regulatory frameworks, while others have completely ignored or avoided adopting them. This makes the development of common standards challenging, while also allowing for manipulation and unethical practices.
EU "5AMLD"
On January 10, 2020, the European Union’s 5th Anti-Money Laundering Directive (5AMLD) was signed into law. This new legislation ostensibly aims to increase security within the borders of the European Union, and it will also have a direct impact on cryptocurrencies. The announcement of 5AMLD marks the first time that digital asset service providers will be regulated.
The most notable changes 5AMLD has made to current KYC requirements are now rewritten with many strict clauses. This includes mandatory monitoring of all transactions and submitting suspicious activity reports. For exchanges operated by the European Union, KYC not only requires a valid ID, but also requires strict identification through various methods.
The U.S. Cryptocurrency Act of 2020
In addition to the EU's 5AMLD, the United States has also proposed a bill, the Cryptocurrency Act of 2020. In summary, it proposes to decipher the laws and regulations of encrypted assets and try to resolve the tension between regulators, issuers and investors to clarify the definition of digital assets and encrypted currencies.
The bill divides digital assets into three parts by type, and the regulator is responsible for monitoring each type. Cryptocurrency is now a representative of U.S. currency. It is based on a decentralized ledger managed by the Treasury Department through a financial crime law enforcement network. Encrypted commodities refer to economic commodities and services that are completely or substantially replaceable based on the blockchain protocol under the supervision of the US Commodity Futures Trading Commission. Finally, crypto securities are stocks, debts and derivatives based on the blockchain managed by the US Securities and Exchange Commission.
Malaysia's digital asset guide
Earlier this year, the Securities Commission of Malaysia issued the country's guidelines on digital assets, especially the regulatory framework for token trading. All digital assets provided in the form of tokens can only be carried out on platforms approved by the committee. These guidelines also include requirements that must be met by token issuers.
To issue tokens in Malaysia, platform operators must obtain authorization from the committee and require a minimum paid-in capital of 5 million ringgits ($1.23 million). In addition to other requirements, they must also conduct the necessary assessments and due diligence to verify that the issuer, its board of directors, the tokens provided and the details of the announcement meet the requirements.
Regulation promotes trust and confidence
"With a clear regulatory path for compliance, the trading platform will comply with applicable laws and regulations, and the trading platform will be more transparent." Sheldon Xia, CEO of BitMart, the world's leading digital asset trading platform, said: All safety concerns will be alleviated."
If more and more countries formulate clear regulations, people's confidence in digital assets will continue to grow. This will help build the trust of mainstream investors. Trust is important, and this can only be established through transparency and regulation.
The increasing demand for digital assets has led to the need for global regulation to help their continued adoption. With the implementation of existing laws and regulations, more and more people will have trust and confidence in digital assets. Xia concluded: "With the establishment of a more comprehensive regulatory framework, the maturity of the cryptocurrency market will also increase, which will benefit the development of the entire market."
The content of this article is compiled and compiled by WarpFuture.com Security Consulting Company. Please indicate if reprinting. Qusu Future provides related blockchain security consulting services including main chain security, exchange security, exchange wallet security, DAPP development security, and smart contract development security.