Cryptocurrency Regulations May Be Coming Soon
2021 has undeniably been quite a big year for cryptocurrency investments, but a lot of people are asking: what’s next?
This year has seen a lot of news about large cryptocurrencies like Bitcoin, which has just recently reached an all-time price high. There have also been talks about regulation, which has a huge potential to affect the whole industry.
Popularity Of The Cryptocurrency Trading and Investments
More major companies have also been reported to be buying into cryptocurrencies. Meanwhile, the general public’s interest in cryptocurrencies reached some of its highest levels this year.
Cryptocurrency Investments have become the subject of conversation not only among investors but among the common folk, too, thanks to the support it gets from public personalities like Lionel Messi or Elon Musk.
Even pop culture has not been exempt from talking about cryptocurrencies, thanks to the existence of “meme” coins, which are cryptocurrencies that quickly gained a lot of popularity relatively quickly, thanks to the promotion that it gets from online influencers.
It seems like everyone, from financial experts to random Facebook friends, is talking about cryptocurrencies.
Because of all the attention, it has been getting, 2021 can be considered a breakthrough year for cryptocurrencies, according to experts.
Is Cryptocurrency Investments Risky?
Despite the large numbers and the success stories that have been popping up recently, cryptocurrency is still believed to be in its infancy and is still in the process of evolving.
It is still hard to make predictions as to which direction it will go, but experts believe that cryptocurrencies will soon be subject to regulation. This will not only help the wider adoption of crypto among institutions, but it can also provide insight and help us get a better sense of the market.
If you want to be a part of this continuously growing market, then you can head on over to this trusted cryptocurrency exchange platform that is equipped with the right tools to help you get started.
What About The Cryptocurrency Regulation?
As mentioned, there is likely to be more conversations regarding cryptocurrency regulation. Lawmakers all over the globe are trying to make cryptocurrencies safer through the creation of laws and guidelines. Creating laws for the regulation of cryptocurrencies may also help it deter cybercriminals and hackers.
These efforts can be seen in countries like China, which have doubled their efforts to regulate cryptocurrency mining rigs. The U.S. is now even considering putting new regulations in place to enforce and encourage cryptocurrency tax reporting.
But like everything else in regards to cryptocurrencies, regulation can be complicated and comes with its own set of hurdles. There is the issue of different agencies not having complete jurisdictions to oversee every aspect. And there is also the issue of possibly having different rules per state, or at least in the case of the U.S.
Because there are no solid guidelines at the moment, investors and firms are currently operating blind. Having clean-cut rules and regulations has the ability to remove the roadblocks that cryptocurrencies face.
What Could The New Regulations Mean For Investors?
Well, for starters, the new legislation about to be put in place can help regulatory entities find cases of tax evasion easier in the cryptocurrency market. The new rules can also make it easier for investors by having a way to properly report their cryptocurrency transactions.
The upcoming buzz around regulation can also affect the prices of a cryptocurrency. Prices in cryptocurrencies are known for being affected by world events or industry news, and talks of regulation can definitely qualify as a catalyst for price changes.
This kind of market volatility is why financial experts would suggest that you should keep your cryptocurrency investments at not more than 5% of your investment portfolio.
For the beginner’s investments, it is much less than this percentage. The more you invest, the less. Your chances of loss chances are also going to decrease.
And if you think that you have the right risk tolerance for cryptocurrencies, you can visit this secure and beginner-friendly crypto trading site that can help you get started.
Many experts agree that regulation can bring about good things to the cryptocurrency market. It can be a win for everyone involved. It might take some time to get things right, but having clear regulations in place can help people have more confidence in crypto.