U.S. should not follow China in crypto
China and the United States have divergent regulations on cryptocurrencies. China is now clear about banning cryptocurrency trading. In the United States, cryptocurrencies are thriving, but there is no clear federal regulation on it. Cryptocurrency professional Katie Haun is of the view that the Chinese experiment is a learning experience for the United States. She advocates that the U.S. should follow an opposite path of China in framing guidelines for cryptocurrencies.
Cryptocurrency trading in China
The Chinese government has been restricting cryptocurrency trading all along. But the government is not opposed to Blockchain technology. The Chinese approach to cryptocurrency is somewhat paradoxical. China acknowledges that Blockchain technology is a great asset for the country’s economic development. The Chinese reluctance in accepting cryptocurrency is due to the fact that cryptocurrency is highly decentralized. China has a highly centralized political and economic system. The Chinese official position is that it is opposed to a speculative economy based on cryptocurrencies.
Due to regulatory loopholes, Chinese investors used international cryptocurrency platforms for trading. Trading by Chinese investors in cryptocurrencies was thriving. Recently China declared all transactions involving cryptocurrencies as illegal. As a result leading cryptocurrencies such as Bitcoin fell sharply in the global market. It is also believed that the cryptocurrency ban is aimed at promoting Chinese central bank promoted digital currency e-yuan.
Scenario in the United States
In the US, both federal and state governments have endorsed cryptocurrencies. A uniform regulatory framework is yet to be in place in the country. States such as Wyoming, Colorado, and Ohio have passed favorable laws regarding cryptocurrencies. But Maryland and Hawaii have expressed apprehension about cryptocurrencies.