Bitcoin entrepreneurs are attempting to set up their own digital currency regulatory body called DATA - the Digital Asset Transfer Authority.This is extremely disturbing, as such organizations tend to end up being controlled by the strongest players, who then end up playing footsie with government, which ultimately results in regulations that prevent smaller players from entering the sector.
The committee for DATA will "work proactively with regulators and policymakers to adapt their requirements to our technologies and business models," the group said in an announcement late last month.
"We must develop and implement common risk management and compliance standards that address the public policy concerns associated with our businesses. And our firms must build risk management and compliance programs that meet those standards," it added.
Wednesday, August 14, 2013
Disturbing Bitcoin News: The Digital Asset Transfer Authority.
Not only is new pressure on Bitcion activities coming from the Sate of NYa and the federal government, but players withing the Bitcoin arena are attempting to regulate the industry. Activist Post reports:
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Bitcoin, like cash, will exist in both regulated and unregulated markets (including black markets).
ReplyDeleteBitcoin transactions that do not involve financial institutions or regulated businesses can be conducted with user-defined privacy (people can be as private as they want to be provided they use the tools available).
Unlike cash, bitcoin cannot be inflated to oblivion.
"[S]uch organizations tend to end up being controlled by the strongest players, who end up playing footsie with government, which ultimately results in regulations that prevent smaller players from entering the sector."
ReplyDeleteAs opposed to what, specifically? Without offering a viable alternative, this is empty fear-mongering. It is naive to expect that US regulators are going to sit idly by and do nothing about Bitcoin. Without DATA, the Bitcoin Foundation, and the Mercatus Center to offer the other side of the argument, US regulators are left to make up rules in a vacuum.
As for being co-opted, it cuts both ways. I refer the reader to the literature on Regulatory Capture. If DATA can achieve the stature of FINRA, AICPA, the American Medical Association, the American Bar Association, etc., then that is a good thing. Better that, than just dumping Bitcoin into a pre-existing and ill-fitting regulatory bucket (H/T Jerry Brito).
There is a world of difference between regulation and filing. Check cashing and payday advance stores, vending machines, and pawn shops are all regulated, and there is no shortage of them. Regulation is not the end of the world; if it were, then a lot more of us would run red lights and speed through school zones.
If anyone is really interested in knowing what the MARKET consensus is about the future, ignore pundits who have no skin in the game, and read the charts. While members of the Senate met to discuss Bitcoin, the USD price went up by about 10%, before beginning a slow drift back toward USD 100. That was the market metaphorically breathing a sigh of relief.
Dr. Charles Evans
CFO, Bitcountant.com