Wednesday, April 11, 2018

Lack of Regulatory Clarity Surrounding Cryptocurrencies Fuels Fraud

The CFTC recently ruled that cryptocurrencies are commodities. While this seems more reasonable than classifying them as property as the IRS has, it does nothing to clear up the situation surrounding the proposed regulations of these new markets

Allegations of fraud run rampant among critics of crypto. The lack of regulation is often pointed to as a potential shortcoming of the sector. Yet why do so few point the finger at the real culprits creating such confusion? The regulators themselves have caused this uncertainty. Any fraud that does happen, which has been noted to be minor and rare, probably occurs as a result of confusion and inability to comply with ambiguous legal frameworks.

 Crypto Confusion Creates Nothing but chaos

Commodities or property – which one is it? How can something classified as two different asset classes possibly hope to be dealt with correctly by those who participate in its marketplace?

While cryptocurrency was founded upon certain libertarian or anarcho-capitalist ideas, some regulatory clarity and consumer controls are not opposed by many within the crypto community. In fact, many seem to prefer this option to the current state of indecision and mass confusion. Yet so long as this scenario persists, people will continue to shun any proposed rules or regulations for the simple fact that they are too difficult to follow.

In 2016, 800 people reported income from crypto to the IRS. Millions of American accounts exist on Coinbase alone. That means that millions neglected to state their profits or losses. Did they do this in a deliberate effort to deceive authorities? Or did they simply have no clue as to how they would go about doing otherwise?

Fraud, or Failure to Comply with Unclear Guidance?

Such criticisms only seek to discredit cryptocurrency. These feeble attempts have been occurring since at least 2013. They never seem to change or go away.

As time goes on, these hysterical criticisms will fade into the background. They have persisted for much longer than anyone might have expected. But they grow more and more ludicrous by the day as the reality continues to defy the delusion.

1 comment:

  1. Cryptocurrency Fraud is one such bad issue which lead to huge loss of hard earned money. One must seek help from professionals such as scam recovery