Crypto space clarity: a limitation for adoption
Bitcoin have been around for couple of years, it has gained traction in both local and international places, sometimes its becomes a topic of discussion in family gatherings, people who share same view in this emerging technology seem quite very optimistic about crypto and it future potential to be the world's leading currency, to some the world will go completely decentralized years from now and those who couldn't get in early might miss out or maybe buy at all time high.
Fun fact: like every other recognized legally accepted currency out there, crypto needs you and me to thrive (adoption)
This makes adoption a key element for crypto growth both long and short term, adoption is inclusive with usecases blockchain technology are currently solving; a counter party peer to peer service that enhance user trust, a technology built on transparency and removes the need for third parties giving users direct access over their financial asset.
As more users get exposed to crypto space their dependability on use of centralized based system for their daily transactional activities are gradually reduced, this virtual means more crypto adoption less centralization dependence.
This is where regulatory policies now creep in, for crypto to fully get the full attention it need it has to play by the book of centralized systems, each transactions recorded on the block need to be verified by lawmakers. The discrepancy between what decentralization in crypto space stand for makes it difficult for it to harmoniously work hand in hand with centralized authorities which has led to ban of crypto use in some major parts of the world.
Coinbase isn't taking no for an answer
No one looking fairly at our industry thinks the law is clear or that there isn’t more work to do, Paul Grewal Coinbase chief legal officer source
Coinbase the Francisco based exchange has yet again taken a step to sue U.S security exchange commission (SEC) for failing to give the crypto based exchange clarity on what category crypto token falls either as unregistered or registered assets. U.S SEC chair Gary gensler has pointed out majority of crypto token with the exception of bitcoin falls under unregistered token this mean top market cap token like cardano (ADA)polygon (Matic) and Solana (Sol) probably fall under unregistered token.
Coinbase last year took U.S SEC to court for further clarification on crypto asset, which the SEC had failed to address, after a long waiting period of 18 month Coinbase is again suing U.S SEC for not responding to their request as SEC refute to give proper clarity on rules governing crypto assets.
Clearly enough a lot is at stake as most users are eagerly waiting on lawmakers to make their next move known to the masses on the validity of crypto assets until such clarity is provide from lawmakers some users will remain skeptical about cryptocurrencies which in turn limits adoption.
Why we need clarification for adoption
Decentralization is kinda the opposite of centralization one deals with smart contract while the later require middlemen, this makes it difficult for policymakers to validate the use of trust less mechanism for financial purposes, since users are exposed to virtual exploit from perpetrators decentralization isn't safe for users as most lawmakers claim, while these lawmakers tend to disagree with the ethos of decentralization adoption of crypto space could be limited by regulatory policies set aside by these lawmakers which is why crypto space need to be recognized by these authorities for adoption to increase.
Investors confidence: although crypto space and it broad technology isn't just limited to finance both security and it financial sectors need users trust this trust can be strengthened when lawmakers install a clear regulation that will guide investors and provide a better legal framework which can be used to protect investors.
Reduce regulatory uncertainties: lack of regulation increase fear, without proper regulation imposed laws to crack down certain investment can install fear on investors a proper regulatory framework can easily counter these fears.
Market integrity: a clear regulatory oversight can increase market integrity which can help prevent fraudulent activities in crypto space.
Institutional adoption: with more clarity there will be increased interest from institutional bodies to venture into the crypto space.
In summary adoption in crypto space is very important as it determines how the space is growing user base wise and capital incentive for adoption to gain more traction regulatory insights on use of cryptocurrencies are very important.