A senior official in the Federal Reserve Bank in the United States has emphasized on the importance of regulation towards wider crypto adoption.
United States Federal Reserve Board Governor, Christopher Waller, who was speaking at a Conference on Crypto Assets and Financial Innovation in Zurich, Switzerland, pointed out that new users will only be trooping to make use of cryptocurrencies when they have confidence in the assets – as it is, financial intermediaries can only help to manage the risks attendant in crypto but not eliminate.
Waller reminded crypto enthusiasts that majority of the people who are using cryptocurrencies are experienced investors who know how to operate in unregulated marketplaces and may not need or want regulation. He backed this with a 2021 Federal Reserve Bank survey which established that only 12% of American adults own crypto, and 99% of them hold it for investment purposes.
According to Mr. Waller:
“The question isn’t about what experienced users of that ecosystem want — it’s about what the rest of the public needs to have confidence in the ecosystem’s safety, and for better or worse, you can’t program confidence.”
– Board Governor, U.S. Federal Reserve
Waller made key observations as to why regulation is important for even authorities – Intermediaries in the financial market may want regulation because new users who have negative experiences with crypto could enter into disputes with them
Regulation of cryptocurrencies is considered a key ingredient for the success of businesses operating in the sector. In Africa, South Africa, Kenya, and Nigeria, and most recently Uganda, have taken the most active steps in regulating cryptocurrencies.
According to a recent report by Crypto Valley, Kenya and South Africa are 2 of just 6 countries that have a legal environment for cryptocurrencies across the continent.
On the other hand, Nigeria’s Securities Exchange Commission released new rules for Digital Assets as part of its effort to regulate digital/virtual assets such as Bitcoin and NFTs.
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