Lithuania-based crypto payment company Mistertango has released a study which reveals that 88% of cryptocurrency exchanges want industry regulation. The study was based on responses from 24 crypto exchanges across the world with a total daily trading volume of over $100 million. The responses show an industry that wants to be part of the formal system, not outside of it — contrary to public perception.
Cryptocurrency Exchanges Want Regulation
The study reveals that 88% of crypto exchanges want regulation, as they believe it could stabilize prices and create a level of certainty that the market has not experienced for a while.
Mistertango Business Manager Gabrielius Bilkštys said the market needs regulation more than ever as it would create the required level of stability investors crave.
Join CCN for $9.99 per month and get an ad-free version of CCN including discounts for future events and services. Support our journalists today. Click here to sign up.
“The industry is crying out for regulation, and the response from partners has shown this. Uncertainty is the biggest fear, and regulation is critical to provide the stability we need. Unfortunately, there is no regulatory consensus – worldwide or otherwise. For cryptocurrencies to move towards the scale and ubiquity possessed by fiat currency, it needs cohesive, considered and comprehensive regulation. Thus, regulation will be a catalyst, not an inhibitor to the crypto market development.”
Regulation could solve some of the threats that have plagued the market in the past, but some fear that too heavy a hand could also destroy the market. Seventeen percent of respondents said that they believe “overly strict regulation is the biggest threat to the cryptocurrency.” We’ve witnessed scenarios where regulators came down hard on exchanges. This has become quite popular in Asia, where trading has been shut down in the past, which led to extreme price volatility.
Oleksandr Lutskevych, CEO of CEX.IO — one of the top crypto exchanges based on market volume — believes the market will mature better when it’s regulated.
“Until now, the industry has not had its say on regulation. It has been widely supposed that crypto companies want to avoid a regulated environment, but this is far from the truth. The industry is all too aware that regulation will lead to the maturity of the market and ensure businesses remain free from suspicion of involvement with illegitimate uses of cryptocurrency.”
While anonymity — or in the case of most cryptocurrencys, pseudonymity — has been one of the biggest allures of the market, 55% of respondents are willing to beam the light on customers trading on their platforms using KYC/AML checks, as is done with traditional financial services, in a bid to make crypto free from illegal uses.
Some of the respondents believe the banks hold the aces when it comes to crypto adoption. About 40% of crypto exchanges in the study think “reducing barriers to funding crypto activity by banks will improve acceptance.” This is one of the factors driving adoption in South Korea, known as one of the largest markets for cryptocurrency trading.
Shinhan Bank, the second largest bank in the country, provides local exchanges with virtual bank accounts, which traders can also use to withdraw and deposit without having to use their actual bank account. The respondents believe a change in the attitude of banks will have a massive impact on the global acceptance of cryptocurrency but that this can only be achieved if the industry is regulated.
Images from Shutterstock