Cryptocurrencies have been under investigation from US Congress lately, due to their speculative nature, as well as the possible negative effects that speculating in digital currency can result in. There is now a strong possibility that Congress will impose legal restraints to make it more difficult for individuals to practice trading in speculative digital currencies.
Many investors and gamblers have taken a chance on these cryptocurrencies, in order to take advantage of making a lot of money quickly. This has proven to be dangerous in itself, along with the fact that trading digital currencies uses a get deal of energy all over the world, leads to a shortage in graphics cards and causes the tracking of criminals online to be more challenging.
A big reason why US Congress is looking into the trade of digital currencies is that speculating in it can have serious downsides. Individuals are investing their money into something that they predict will rise in value, and yet, has no real backing, similar to what occurred in the stock market crash in 1929. All of the big digital currencies have experienced significant rises as well as dips, however, no safeguards exist to stop a flash crash.
Of late, the value of Bitcoin, which is the most well-known of all cryptocurrencies, took a serious fall. At its highest Bitcoin was worth $20,000, but it has since fallen to a low of $6,000. Between December 2017 and February 2018, Bitcoin lost more than $200 billion in market value. And since these fluctuations in value are part and parcel of trading, US Congress feels that people may not know that their investments are more risky than what they realize.
In the coming weeks, the House Financial Services Subcommittee on Capital Markets, headed by Committee Chairman Bill Huizenga, will be holding hearings. Mr. Huzienga has acknowledged how much the market has changed, due to monumental growth within a short period of time.
Another problem that cryptocurrency trade has faced is the hacking of digital currency exchange sites. Billions of dollars have been lost due to hacking in the last five years, leaving users with no solutions to get their money back. The government has not been prone to interfere with digital currency matters, nor has it been restrictive with it. However, the SEC has begun a crackdown on coin offerings in order to avoid fraud and prevent the financing of suspicious organizations.
Senator Senator Chris Van Hollen, a member of the Senate Banking Committee, has said, “the goal here is to have rules of the road that protect consumers without trying to squash innovation,” showing that legislators are well aware that this technology is about much more than speculation and trade. Expect that the nature of cryptocurrencies themselves will evolve as legislation and regulation concerning them are set down.
Some netizens seemed doubtful that the government really wants to protect people.
Others argued that the lack of legislation concerning digital currencies is what makes it attractive to people