Jon Trinder, Product Manager at Linedata, comments on the missed opportunity for G20 ministers meeting in Brazil to regulate global crypto-currency markets:
“It’s disappointing that the G20 has decided not to take any action in regulating crypto markets at this time. With so many fraudulent Initial Coin Offerings (ICOs), and a high failure rate among seemingly legitimate ones, this would have been an ideal opportunity to provide some investor protection. Furthermore, the broader DLT community would benefit from much needed regulatory certainty to help develop cross jurisdictional solutions.
“Realistically, only a co-ordinated effort from the G20 is likely to provide this framework. FINMA recently released its ICO guidelines, including its categorisation of tokens into payment (cryptocurrencies), utility (used to access an application on the blockchain), and asset (securities) tokens, with different regulatory approaches and obligations for each. However global co-ordination is required.
“Money laundering remains a key struggle for cryptocurrencies and it tarnishes the perception of the broader DLT eco-system. With the Facebook / Cambridge Analytica furore, the need to lay firm foundations for digital identities is now all the more urgent.
“At its core, a user-controlled digital identity should eradicate a criminal’s ability to launder money, and allow people to transact online securely and seamlessly, while safeguarding all their sensitive personal data. Perhaps as importantly, in light of recent events, it takes away the power to misuse this data from companies, and instead returns this control to individuals.”