If you are keen on making smart investments, or your business will be accepting cryptocurrency for payments, then it is essential you know the regulations that can impact you.
The popularity of cryptocurrency is increasing year on year, and with more types of coins available, staying up to date with everything is imperative.
Bitcoin and other cryptocurrencies aren’t just about investments; consumers want to spend their coins on goods. This is where Bitcoin ATMs come into play and where Bitcoin ATM regulations will impact you.
Photo by Aleksi Räisä on Unsplash
What is a Bitcoin ATM?
Rather than using a bank card, a BItcoin ATM will use your crypto wallet, and this is where your coins will be sent to or debited from. A Bitcoin ATM varies from traditional ATMs because you can buy and sell Bitcoin at one, rather than just withdraw cash.
This machine bypasses regular banking, and while there are purchase limits and verification processes, you can buy or sell the following coins:
- ETH, Ether
- DASH, Dash
- LTC, Litecoin
- BCH, Bitcoin Cash
As well as other coin options.
Are there any issues with virtual currency?
Yes, when you use a Bitcoin ATM, you use what is classed as a payment service. Payment services fall under the laws and regulations of specific governments and states.
That means that many states require a money transmitter license when it comes to digital money, currencies, or tokens.
Another concern for governments is that they want to reduce fraud and still maintain consumer privacy. Not only that, but they must limit the chance of money laundering – precisely like with standard centralized currencies.
The only way that governments can manage these processes is by implementing regulations to things like Bitcoin ATMs.
There are more than just Bitcoin ATM regulations, though; they are just one item that consumers need to be aware of.
How are cryptocurrencies regulated right now?
Policymakers haven’t been as quick to implement regulations around cryptocurrency as they might’ve liked. That is because the crypto markets are fast and volatile.
Since it is decentralized, building a framework for regulation becomes more complicated. What this means is that early adopters of cryptocurrency could effectively set the rules of buying, trading, and owning.
The rules are still very loose, but there has always been a specific way to find/buy bitcoin, how the blockchain works, and the information held on the owners.
What changes might we see in cryptocurrency?
When laws and regulations come into play, things will change. While cryptocurrency has been around for a while, it is still relatively new, and the digital coin markets are changing all the time.
One of the most important things is to define what a bitcoin is – for example, could it be classed as a commodity?
Before they ever get to the point, government bodies must decide who and what is responsible for the market. Defining the terms around cryptocurrency will be one of the first things that signal the change in how crypto is handled.
One of the mistakes that have been made is that both the CFTC and SEC approached bitcoin and cryptocurrency as they would any other bond, stock, or asset. Since there were already regulations in place, it was always tempting to see if the framework worked.
There is a call for fresh rules and regulations to be implemented to make sense of how cryptocurrency works.
Something that goes against what makes cryptocurrency so enticing is that call for excellent transparency and some rights for new investors. This comes under market manipulation, and it is highly probable.
One more thing worth noting for those who have cryptocurrency is that there is also a push to have tighter tax laws.
Is this all positive?
Anyone who invests knows that one of the things that keep their investments safe and legal is regulations. While cryptocurrency is still a flourishing market, it is an excellent time to have some rules that allow it to be regulated.
The likelihood of cryptocurrency becoming even more popular is likely. When there are regulations and laws in place, consumers feel safer.
A quote from Robert Jackson, the former SEC commissioner:
“The market will be better off, because assuring investors that they are getting the kind of transparent pricing they are used to in American markets will encourage other investors to consider the possibility of investing in cryptocurrency,”
Of course, these regulations won’t please everyone, and there will likely be significant kickbacks when the tax rules come into play.
The cryptocurrency was designed and enjoyed because it was not tethered to banks or governments; the decentralized nature makes it so enticing. However, these rules and regulations are essential to make crypto more accessible to everyone and a part of everyday life.
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