Cryptocurrency Regulations Around the World

Aqib Yasin March 20, 2023 0 Comments

With the advent of cryptocurrency, the financial world has seen drastic and unprecedented change. While there have been tremendous opportunities for investment and trading, regulations around the world have had wide-ranging impacts on the industry. In this guide, we’ll look at the regulations governing cryptocurrency and their impact on the industry.

US Regulations of Cryptocurrency

The United States has some of the most detailed regulations of cryptocurrency in the world. The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) provide a comprehensive regulatory framework for oversight of cryptocurrency transactions involving US actors. These regulations include things like registration requirements, reporting requirements, and limits on leverage. Understanding these regulations is paramount for anyone looking to engage in cryptocurrency trading in the United States.

Russia’s Approach to Cryptocurrency Regulation

Russia’s approach to regulating cryptocurrency has been cautious yet malleable. In 2020, the country added further restrictions in a new law that ordered exchanges to register with the government and obtain a special license to operate. Although this law stipulates that crypto transactions are still illegal except for those done through certified companies, it does clue us in on their willingness to recognize digital currencies as a form of payment in the future.

China’s Stance on Crypto Regulation

China has recently made news for its strides in cryptocurrency technology, but its legal stance on digital assets is largely still a mystery. What is known, however, is that the country’s Central Bank has taken a cautious approach to regulating the crypto space and has issued warnings about risks associated with investing in crypto assets. On top of that, crypto exchanges are not allowed to operate in Mainland China and individuals engaging in digital asset trading could face consequences.

EU Regulatory Frameworks for Crypto Companies and Traders

The European Union (EU) encourages innovation within the digital asset trading industry and provides some guidance for crypto companies and traders. Companies must be registered with a local Financial Intelligence Unit (FIUs) to carry out their activities across the EU. This means that companies may need to obtain a license in each EU member state they are operating in, depending on the activities they perform. Additionally, KYC, AML and CFT procedures are required by law to ensure safety of investments.

The United Kingdom’s Regulatory Landscape for Cryptocurrencies

The UK has adopted a holistic approach in addressing the challenges associated with trading cryptocurrencies. Firms are required to obtain authorization from the Financial Conduct Authority (FCA) and comply with its anti-money laundering regulations. Furthermore, firms must register with HMRC for taxation purposes and report any suspicious activities or transactions. Additionally, the FCA requires firms to have appropriate capital and risk management practices in place which adhere to applicable principles of good governance and compliance.