LEGAL REGULATION OF CRYPTOCURRENCIES AND APPLICABLE RISKS

Andrei Novikov
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Andrei Novikov: University of Tartu

EUREKA: Social and Humanities, 2018, issue 4, 32-35

Abstract:

Cryptocurrencies – a new, but quickly developing concept within the sphere of finance. Opinions regarding it still differ, not only on a personal level, but also when it comes to governments. Overall the legal regulation regarding cryptocurrencies in the world is still in the formation stage. Currently the legal norms that do exist, are primarily directed towards the minimization of existing risks, especially in the field of money laundering. Though there is already no reason to doubt, that during the coming years the regulation will become stricter. In some countries cryptocurrencies are outright forbidden. For example, in China, in February 2018 additions to the legislation were issues, that broadened the cryptocurrencies ban. In other countries cryptocurrencies shall be strictly regulated. For example, in Estonia, a member of EU, cryptocurrencies are fully legal. Estonia can be reviewed as a country that independently developed its own regulation in this field. Though there is no guarantee that the legislators will keep up with the quickly developing technologies. One way or another cryptocurrencies exist and are not going anywhere. The legislation that regulates them shall be developed further and they shall become a important part of the modern financial system. The level of their influence is hard to predict, things are changing too quickly, but their existence is a fact. It is necessary to remember, that that cryptocurrencies are not a magical solution or means of profit. It is a financial instrument, new, in many ways unique, with its own special drawbacks and benefits. It is important to know and understand them, also to keep an eye on the developing technologies.

Keywords: legal regulation of cryptocurrencies; use of cryptocurrency in Estonia; cryptocurrency as a financial instrument (search for similar items in EconPapers)
Date: 2018-07-31
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