The United States government, along with many states across the country, is currently drafting laws that will regulate the use of a digital currency called “Bitcoin”. This is an attempt to ensure that the use of this new “virtual currency” is completely safe and regulated by all regulators, as well as by financial regulators who oversee traditional currencies.
There are two types of regulations that financial regulators have in mind when it comes to regulating the use of these new “virtual currencies”. One is for the public to be protected from the potential dangers associated with this new technology. The other type of regulation is a mandate for financial companies to provide for a level playing field for all digital currencies. In order for any regulation to have an effect, both need to be present.
One thing is for sure, these two regulatory agencies have a vested interest in the regulation of this new technology. After all, the biggest danger facing society right now comes in the form of the current financial crisis that has plagued the world economy for over a decade. If digital currency were to be a part of the solution to this crisis, regulatory agencies would certainly benefit from this development.
The main thing for every new digital currency will be a requirement for financial institutions to be licensed in order to deal with this new technology. Many banks will not be able to deal with this new technology without first acquiring licenses, and if they can’t be licensed, then this new technology will have no place in the financial industry. Of course, this will be good news for those who wish to use digital currencies as a form of investment, as there will be a very high degree of security for those who make this decision.
Another type of regulation that these regulatory agencies will be looking for is a standardization of terms relating to the use of these new digital currencies in the US economy. The idea behind this standardization of terms is that everyone involved will know exactly what a digital currency looks like, what it can do for consumers, and what legal issues exist for that particular digital currency.
With regulation of these new innovations, entrepreneurs around the globe will be able to take advantage of a completely different set of regulations than those that apply to them. For example, instead of having to deal with the regulations that pertain to banks, they will now be dealing with regulations that pertain to digital currency businesses. The US regulators are looking for the use of new technology to be able to reduce the risk for everyone involved in the industry and increase the stability and safety of our financial system. This new technology will be used to ensure that all entrepreneurs can compete fairly on a level playing field.