The world’s biggest exchange for trading different cryptocurrencies, Binance (BNB), insists that rules and regulations for the crypto market should be implemented. They believe that crypto platforms are obliged to protect users and administer procedures. This is mainly to avoid financial crimes. Alongside this, the company issued “10 Fundamental Rights for Crypto Users”.
An Independent Industry
The industry operates without help from the government or other authorities, which makes their call for regulation a bit odd. However, Binance CEO Changpeng Zhao stated that industry regulations are unavoidable. Zhao added that it would entice people to invest in and believe in the industry’s credibility and safety.
Zhao stated that most of the regulators around the world are looking closely at crypto this year. As a result, many people are getting in touch with them, so he feels that this is the perfect time to call for a global framework.
As it is globally known, cryptocurrency receives regulatory criticism from people. This happens as big businesses, professional investors, the government of El Salvador are buying in. Critics couldn’t seem to understand the value of digital currencies as they are being managed by non-governments. Crypto’s base widened its initial core of fanatics and Bitcoin set a record as high as $68.901. It even doubled in 2021.
Business Before Crypto Regulations
Gil Luria, a technology strategist at D.A. Davidson, said that Binance is doing what Uber and Lyft did–building a business ahead of regulations. When it reaches a specific scale, acknowledge that regulation will be of great help and then adjust it if needed.
Zhao stated that Binance acknowledges regulations for a lot of reasons. One of the minor reasons is a selfish reason. It is that the small number of big players remain and, unluckily, the number of smaller players breaks off.
Zhao looks forward to selling stock on a U.S. exchange soon, which is a smart move for Binance. One of Binance’s competitors, Coinbase, raised a close $74 billion market value on Wall Street after its first public offering in the spring.
A Need for Investor Protection
According to Gary Gensler, chair of the Securities and Exchange Commission, in his speech this summer, they just don’t have enough investor protection in crypto at present. The said asset is commonly prone to fraud, scams, and abuse in some applications. Crypto assets workers markets more aggressively than it normally should. As a result, people don’t receive balanced and reliable information.
U.S. regulators involved in the financing of terrorism expects reports from Biannce. Some marketplaces offer “derivatives and leveraged instruments” that produce a great deal of profit, which is why one of Binance’s “fundamental rights” demands strict rules. Although it is extremely profitable, it could be a high-risk trade for investors.
Zhao said that most regulators focus on knowing their customer rules, where they verify the identity of whoever is using their services and put in protections for consumers. He also said that every country has different interpretations and understandings of these rules. For instance, preventing money laundering emphasizes blocking financing for terrorism . Furthermore, chinese regulators look for people to move money out of the country.
Zhao also stated that some parts of the cryptocurrency world look like securities while others look like commodities or currencies. As a result, people can easily create new tokens since the ecosystem is growing each day. He also added that people look at crypto as a single asset, which he thinks is misleading. As per Zhao, crypto is a fundamental technology that improves many of the conventional asset types.
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