Contents
Introduction
The bull run witnessed in 2021 had triggered a large interest in the adoption of cryptocurrency. With prices of Bitcoin, Ethereum and other cryptocurrencies rising continuously to new all-time highs, many investors were attracted to invest in Cryptos. The opposite was witnessed in 2022 where virtually all the digital assets purchased in the previous years were quick to shed off their previous gains leaving investors in deep loss. The massive price crash this year caused many weak projects to collapse leading to a greater loss for investors who have invested in such projects.
As many investors got fed up and rushed to withdraw their assets from the different crypto exchanges, some exchanges including the second largest centralized cryptocurrency exchange – FTX went bankrupt and was unable to process investors’ withdrawal requests.
This pushed the crypto market into a wild state of confusion and large mourning among investors who have invested heavily in the exchange. The wild outcry from crypto investors had attracted the attention of the different regulatory authorities to legislate further towards the regulation of cryptocurrency within their province.
Such countries as the UK, Canada, France, and the US are currently working on new laws to reshape the face of cryptocurrency transactions within the region. What can we expect from these authorities in 2023? Will crypto trading still be legal across the countries by 2023? This work has made some important legislative predictions for crypto trading in 2023.
What are crypto legislations?
Crypto legislations are laws passed by the various regulatory authorities in the country which define the state of crypto trading within the country. These laws set the standards for crypto trading within the country and spell out the expectations from both crypto traders and various crypto exchanges rendering financial services within the country.
What legislative crypto predictions can we oversee for Crypto in 2023?
Right for the creation of new cryptos
Many crypto projects that have crashed in the past have been due to individuals being permitted to create any coin and listing them for ICO. The story will likely change in 2023 as the regulatory authorities will be pushed to scrutinize each new projects before they are created to ensure they have a strong use case and can stand the test of time.
Close monitoring of centralized crypto exchanges
The multiple cases of crypto companies going bankrupt due to mismanagement of investors’ funds have drawn the attention of the regulatory authorities to monitor the activities going on within the different crypto exchange companies. Many countries today are currently working on passing new laws to give their financial regulators the full right to scrutinize the activities of the various crypto exchanges today and ensure they do not tamper with investors’ funds in the future.
Taxations
The amount of capital pulled in and out of the crypto market has given the tax agents more cause to monitor the capital gains of crypto traders today. Thus, more countries will be forced to develop strict laws to ensure that crypto traders pay their expected taxes.
Stablecoins
The crash of the TerraUSD stablecoin which caused many investors to lose their savings has exposed the vulnerability of the stablecoins. Hence, more countries will likely ban the use of stablecoins within the country.
Is legislation good for crypto?
The idea of regulating crypto has always been to protect the interest of traders against the different projects they choose to invest in. However, many crypto traders today tend to kick against all forms of government interference in Crypto trading through legislation. This is because such moves could bring about the Centralization of crypto which is largely against the purpose for which cryptocurrency was created.
