As cryptocurrencies such as Bitcoin crash and inflation causes prices to rise, investors are quickly moving to the sidelines, so as to avoid losing whatever they may have left. Countless people have lost their savings and investments in recent months, and it will take time for the market to recover, especially with a looming recession. Russia’s war on Ukraine doesn’t help matters and, as all markets are linked to world events, it becomes necessary to not only ride the wave but to anticipate the next one as well.
Bitcoin, long considered to be the safest of the numerous cryptocurrencies with a market cap of up to $385 billion, has plunged over 70 percent from an all-time high to a whopping low $19,895.75 this week. And, it may drop even further. This volatility has alarmed, well, pretty much everyone, and decision-makers are now seeking to limit the ‘wild west’ crypto market but putting legislation and rules in place to safeguard customers. The recent and ongoing crypto market mayhem has led governments to scrutinize the decentralized currency and better understand how to control it in order to create an organized standard.
Alternative coins, such as Ethereum, BNB, Solana, Ripple, Cardano and Dogecoin, have seen modest gains in recent days and together, the overall crypto market cap stands at approximately $900 billion. With this data in mind, speculators suggest that ‘market tourists’ have been scared off by the steep drop and seasoned investors can now expect to see some market stabilization.
However, that still leaves flummoxed governments in the dark. Lawmakers do not want to see volatile markets and a developing movement to regulate cryptocurrencies has gained steam in recent months. But, how can governments regulate blockchain technologies such as cryptocurrencies? The entire point is that they are decentralized, not run by a central government or authority.
There are a few ways governments can control the market, and one of them is by taxing any money investors receive by cashing out a virtual token. According to The NYU Dispatch, “much of the proposed regulations being mulled around the world comes on the fears of a dangerous speculative bubble that many fear could harm the nation if cryptocurrency commodities tumble.”
In April, the UK government…
