What is Bitcoin? remains a question to be answered by financial experts as the king of crypto as it is usually called, is caught in a dilemma of identity as it still can’t be ascertained if it is a commodity, security, or currency. The crypto performs several functions from buying things to selling commodities and measure worth of commodities etc.
Bitcoin also passes for a commodity as could be likened to oil, gold whose value continues to change in the international market. It can also be purchased and sold in money markets via derivatives such as futures.
What is Bitcoin? Remains a vague question
The question as to what is Bitcoin could also be asked because it could also act as security. Apart from Bitcoin, other cryptos also are issued like stocks. They are issued at initial coin offerings and used to symbolize shares.
What is Bitcoin? Remains a vague question to be asked, but then in the finance world, it continues to draw attention from economists, lawyers who believe if the issue is not addressed now, it could have a significant backlash on the future of cryptos.
Reportedly, the answers provided to the question, “what is Bitcoin?” alongside other cryptos would point at how it is regulated in countries of the world.
What is Bitcoin? Regulators answer the question
According to the federal watchdogs in the United States, cryptos are viewed by them as securities in the form of shares alongside commodities. However, major world economies have not come up with rules for regulating crypto. The European Union is said to have developed a framework for some months ago that would see cryptocurrency immersed into existing regulations.
On the other hand, the regulation of crypto will have a different effect on people who trade cryptos. Commodity markets function with close to no rules. Securities, however, are usually monitored on several subjects like price transparency, trade reporting, and market abuse.
Benjamin Tsai, president of Wave Financial, an investment manager in charge of over $35 million in cryptocurrency, said that Whenever they are passing through the security process, they spend several million on lawyers to ensure they comply.” Tsai said that it brings more pain than satisfaction.
Different regulators, however, handle cryptos in various manners as regards to their unique characteristics as adopted by Britain in 2019. Certain crypto stakeholders say that using crypto as financial tools similar to securities may be positive.
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