The Role of Government in Crypto

[Alisha-k]

Even without been told once the government starts regulating crypto currency then it's decentralized nature will be altered changing from open source to private and the will ensure the restrict it's circulation even making it unaffordable for the masses. I don't think you know what you are really asking for if you do you will reconsider your proposal

[uneng]

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

Yes, because regulations are part of centralized systems and if they start affecting a decentralized one, this system will become centralized as well. Crypto currency wasn't supposed to be affected by governments' intervention, because it should stay under control of the common individuals only, without the presence of middlemen or demigod regulators who play the cards in traditional financial system.

But that is just theory. In practice things never work as they were supposed to be, because we find many obstacles that are the personal interests of different people, corporations, groups, agendas and so on.

[teosanru]

the primary role of government is to provide a regulatory framework in an economy, Government sole responsibility is to provide a guideline on how thing are to be done within their jurisdictions.

this is not different with cryptocurrency although cryptocurrency is created with high anonymous the truth remains that cryptocurrency co-exist with other factors in the economy such as the bank and the traditional currencies, for crypto to become a full flesh currency it need to under go government regulation because that is the only way cryptocurrency will be considered a legal currency.

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

Actually the role of government in Cryptocurrency theme isn't really the same, it has changed altogether. Government provides guidelines but guidelines are there to be adhered and if they are not adhered the person violating them is punished. But in case of cryptos even after issuing guidelines it's difficult to nab the person who has violated them because it's difficult to find person merely with an address. This means government can only issue what is the best practice it's upto people that they obey that or not.

[palle11]

the primary role of government is to provide a regulatory framework in an economy, Government sole responsibility is to provide a guideline on how thing are to be done within their jurisdictions.

this is not different with cryptocurrency although cryptocurrency is created with high anonymous the truth remains that cryptocurrency co-exist with other factors in the economy such as the bank and the traditional currencies, for crypto to become a full flesh currency it need to under go government regulation because that is the only way cryptocurrency will be considered a legal currency

The government should not have anything to do with regulation of cryptocurrency because it is suppose to be anonymous only encrypted and coded in the Blockchain. Do you know when there is regulation, your identity is one way or another revealed and that is not what cryptocurrency is about. Go and read more about it to understand better. Regulation requires your data just like in the bank while cryptocurrency is a freedom that you are suppose to enjoy to do your transaction or hodl your assets.

[RILWAN]

@palle11 some cryptocurrencies are already regulated, such as the stable coin. The government has started an operational framework that allows a KCY and even some exchanges have introduced some form of KYC when withdrawing some certain amount. So regulations have already started, if cryptocurrency must attained the mainstream adoption then the government will come in and make some regulation and proper taxation. There is no way cryptocurrency can operate smoothly without government interference.

[romero121]

Governments have got different responsibility. With cryptocurrency they need to provide guidelines and it's regulatory framework on which it needs to function. Many countries weren't able to make it, because of bitcoin being decentralized and weren't able to take it into accountability for some reason. Now exchanges have begun to operate with cent percent KYC fulfilment and this truly affects the anonymous usage.

In my country now cryptocurrency usage is somewhat legalized and an exchange recently encountered an issue. Due to some technical issue users who withdraw 500 TRX will receive 14000 TRX. Knowing this lot of users benefitted. Later it was found and it gave a mail to all its users who have received this funds. Some returned the fund and for the rest who hasn't returned the fund were taken to file complaint on police with their KYC. Some way regulations are good.

[vv181]

~snip
So regulations have already started, if cryptocurrency must attained the mainstream adoption then the government will come in and make some regulation and proper taxation. There is no way cryptocurrency can operate smoothly without government interference.

I'd like to think this way, governments are forced to regulate cryptocurrencies instead of the other way around as you stated. Cryptocurrencies have proved to be able to stand the chance with its decentralized nature. And the governments are forced to embrace a new thing to comply with their own intents, which is to minimize the decentralization. I believe surely we could get masses adoption without relying upon governments interference, it is just them that wants to control cryptocurrency.

[verita1]

Bitcoin is a support for economies especially in countries with economic instability and inflation. But governments see it as a threat to their legal tender. They prefer to print paper money and ignore the innovation that bitcoin can bring. It is no secret to anyone that governments have a system with a problem that affects its operation and that is corruption.

Bitcoin can solve it but there is the dilemma so that the implementation is the most appropriate in their economies, they must change the system and adapt it. There must be consensus in the population and adapt the nation to introduce bitcoin. We are waiting for how the country of El Salvador will make bitcoin work in its economy.

[odolvlobo]

the primary role of government is to provide a regulatory framework in an economy, Government sole responsibility is to provide a guideline on how thing are to be done within their jurisdictions.

I strongly disagree with these statements.

[Silberman]

the primary role of government is to provide a regulatory framework in an economy, Government sole responsibility is to provide a guideline on how thing are to be done within their jurisdictions.

this is not different with cryptocurrency although cryptocurrency is created with high anonymous the truth remains that cryptocurrency co-exist with other factors in the economy such as the bank and the traditional currencies, for crypto to become a full flesh currency it need to under go government regulation because that is the only way cryptocurrency will be considered a legal currency.

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

This is completely false and there are many examples of this through history, the process in fact happens in reverse, the people are the ones that decide whether or not they want to accept an asset as a form of money and then and only then the government steps up and recognize this asset as a form of money, this is why governments can say all the bad things they want about bitcoin people are still going to use it because it is a superior form of money compared to fiat, so regulation is not needed for bitcoin to become money, bitcoin is money from the very moment it was created as it fits all the characteristics that money must have.

[Twinkledoe]

~snip
So regulations have already started, if cryptocurrency must attained the mainstream adoption then the government will come in and make some regulation and proper taxation. There is no way cryptocurrency can operate smoothly without government interference.

I'd like to think this way, governments are forced to regulate cryptocurrencies instead of the other way around as you stated. Cryptocurrencies have proved to be able to stand the chance with its decentralized nature. And the governments are forced to embrace a new thing to comply with their own intents, which is to minimize the decentralization. I believe surely we could get masses adoption without relying upon governments interference, it is just them that wants to control cryptocurrency.

Very true. Now, some governments are forced to draft their regulation protocols towards crypto because it is gaining massive interest from the community. So even without their regulation, it is continuously being used by their citizens. If they will not act, still people will use it, unless they totally ban the usage of it. Which is actually hard, as crypto users know how to go around the prohibition. That's the advantage of crypto. The government doesn't need to know your transactions every time you deal with crypto, and that's what they are afraid of. They have no full control about its movement.

[mindrust]

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

Depends.

Since the exchanges are the ultimate FIAT gates and crypto adoption as a currency is limited, once they regulate the exchanges they will pretty much have the ultimate control over crypto. Crypto without any dollar value backing it is worthless by itself. If the gov can control the prices, they control the crypto itself.

[Mahanton]

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

They've been trying to do it but due to anonymity and decentralized aspects then they do fail out to do so which do really ending up on banning it instead of adoption.
We've seen that there are government whom do consider out on integrating or accepting it but still not able to control everything except into those platforms or
companies or merchants that do accept crypto on which they can really able to monitor out inbound and outbound transactions but outside that line is never
been possible for them to trace up and this simply means that both things are entirely different but doesnt mean that they shouldnt exist on the same time.
At least we do have some options.

[Oasisman]

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

Obviously, a big Yes!
One of the major alibis that the government wants to regulate cryptocurrency is to protect the people from fraud and prevent money laundering, but in reality they just want to have a control over cryptocurrency. That basically undermine the main purpose of Bitcoin's decentralisation and anonymity.
I honestly think, Bitcoin doesn't need government regulation just consider it as a currency because some countries are actually using it as a means of payment for product or service effectively and they're not even regulated.

I'm more concerned with the high volatility than the government regulations when we're talking about Bitcoin as a currency.

[jaysabi]

The role of the government in crypto is negligible but even if the government gives legitimacy to decentralize crypto it cannot control crypto. If the government operates like fiat currency then it is a threat to crypto anyone can work in crypto as an independent but I don't think the government can control crypto, they should focus on how the crypto project works and informing them through ongoing communication as well as continuing the long term vision. The more companies can educate their investors the more knowledgeable and confident these investors will be, and the more informed the industry as a whole will be.

The government can definitely control it.  Look at what happened in China recently.  They outlawed mining operations and started cracking down on exchanges and it forced people to sell their bitcoins.  If it was truly out of government's ability to control it, they could make these rules and people wouldn't respond, but that's clearly not the case.

[Dragonfund]

the primary role of government is to provide a regulatory framework in an economy, Government sole responsibility is to provide a guideline on how thing are to be done within their jurisdictions.

this is not different with cryptocurrency although cryptocurrency is created with high anonymous the truth remains that cryptocurrency co-exist with other factors in the economy such as the bank and the traditional currencies, for crypto to become a full flesh currency it need to under go government regulation because that is the only way cryptocurrency will be considered a legal currency.

questions:

will will government regulations on cryptocurrencies undermined crypto decentralized nature?

Regulations comes when government notice that a particular environment is not conducive for her people, hence the necessary instructions and legal action need to be put in place expecially when it involves financial.
Crypto anonymous nature has increased some fraud activities and embezzlement of money that's why government is really concerned about regulation.
However, I think government is overdoing it. They are going far and this is one of the reason Satoshi created bitcoin to fully decentralized in a such a way that no one or group of people have sovereignty over it.

[zanezane]

For me the only role that a government should have crypto is the protection of it's users because people that are involved in the cryptospace is vulnerable to attacks everyday and the only way that I can think of is for the government to have a role as a protector of the users since they have the resources to do it.

[Woodie]

Initiallly government involvement is usually to put the interests of its citizens first buy the problem that's there with crypto is its multinational, no one country can regulate it.
But what I see happening is crypto companies that are setup in some of these countries they are subjected to their laws to try and minimize moneylaundering and impose their tax systems on them to be passed on to its clients.

[Haunebu]

This is an old topic and there are multiple threads related to this topic in this forum op. Check these out.

https://bitcointalk.org/index.php?topic=3122751.0

https://bitcointalk.org/index.php?topic=4699045.0;wap2

In short, it would definitely be beneficial for the governments to regulate cryptocurrencies even if it affected their decentralized nature to some extent in my opinion.

[tabas]

will government regulations on cryptocurrencies undermined crypto decentralized nature?

The government will be able to implement regulations and prohibitions towards crypto even it is decentralized in nature. Have you seen what just happened with Monero?
It was delisted in many exchanges due to governments action.