• Wed. Jun 22nd, 2022

Regulation Key to Mass Cryptocurrency Adoption, Says US Fed Official

ByHazel R. Lang

Jun 11, 2022

A senior Federal Reserve Bank official in the United States has highlighted the importance of regulation for wider adoption of crypto.

US Federal Reserve Board Governor Christopher Waller, speaking at a conference on crypto assets and financial innovation in Zurich, Switzerland, stressed that new users will not be rushing to use cryptocurrencies only when they have confidence in the assets – as is that financial intermediaries can only help manage the risks inherent in crypto, not eliminate them.

Waller reminded crypto enthusiasts that the majority of people who use cryptocurrencies are experienced investors who know how to operate in unregulated markets and may not need or want regulation. He backed this up with a 2021 Federal Reserve Bank survey which established that only 12% of American adults own crypto, and 99% of them hold it for investment purposes.

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SEE ALSO: Nigerian Government to Deploy Marketplace and IP Exchange Wallet on Algorand Blockchain

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According to Waller:

“The question isn’t what the power users of this ecosystem want – it’s what the rest of the public needs to have confidence in the security of the ecosystem, and for better or for worse. worse, you can’t program trust.”

– Board Governor, US Federal Reserve

Waller made key observations about the importance of regulation, even for authorities – Financial market intermediaries may want regulation because new users who have negative experiences with crypto might come into conflict with them.

Cryptocurrency regulation is considered a key ingredient for the success of companies operating in the sector. In Africa, South Africa, Kenya and Nigeria, and more recently Uganda, have taken the most active steps to regulate cryptocurrencies.

According to a recent report by Crypto Valley, Kenya and South Africa are 2 of only 6 countries that have a legal environment for cryptocurrencies across the continent.

On the other hand, the Securities Exchange Commission of Nigeria has issued new rules for digital assets as part of its efforts to regulate digital/virtual assets such as Bitcoin and NFTs.

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RECOMMENDED READING: Bank of Uganda (BoU) welcomes crypto firms to its regulatory sandbox

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