Jeremy Allaire Says that Crypto Laws Must Be In Sync Worldwide
In a recent interview, Jeremy Allaire, the chief executive officer at Circle, drew attention to the world’s need for international regulations regarding ever-increasingly popular cryptocurrencies. The leader of the $3 billion startup also acknowledged the fact the fintech companies are currently functioning within vague regions of law. He stated that this is the reason for the lack of control and security that blockchain investments face. Allaire declared that at the very least the Group of Twenty should work on standardizing crypto laws.
Issues Hindering Regulations Globally
There are a number of issues that regulators are facing worldwide when it comes to setting rules for the crypto ecosystem. Firstly, the advancements in the field of fintech are significantly quicker than the implementation of regulations. Secondly, the legal structures are relatively ancient and therefore are unable to include versatile crypto-related assets. For example, the American SEC deals with cryprocurrencies on the basis of a securities law from 72 years ago and India decided on procedures that seem more hurried than reasonable after spending a couple of years trying to define bitcoin.
On the other hand, some entities are eager to be the forerunners; such as the FATF in Paris. They issued a report on the 26th that declared their intention of presenting the first laws against crimes in the crypto sphere during the coming year. The watchdog emphasized that authorities globally should issue licenses for exchanging cryptocurrencies in order to be able to monitor and prosecute the funding of terrorism and money laundering.
There are only two economies in the world that focused on attempting to standardize and legalize the crypto-sphere as swiftly as it advances. These economies are Japan and Switzerland. Alternatively, China, the second largest economy in the world and a FATF member, has entirely prohibited huge areas of the crypto ecosystem.
Initial Coin Offerings
Mr. Allaire stated that while he applauds the FATF for taking the initiative, the first draft of crypto-based laws should make its position regarding ICOs significantly clear. To this day, it has transpired that plenty of ICO rounds are actually a letdown, a shell game, or vaporware. This is why some watchdogs have misunderstood funding based on tokens.
Allaire said that the new laws must identify what is legal and what is not regarding market manipulations, the production of tokens by private companies, and KYC. He asserted that the laws should decide how to deal with token offerings, which can be considered securities, and what decrees should be set to thwart market manipulation in the trading venues.