A global crypto regulatory body may be coming soon; here's what we know so far

Bitcoin slides 50% from its all-time high; is there more pain ahead?

"Crypto has obviously rocketed up the agenda," said Ashley Alder, who chairs the International Organization of Securities Commissions (IOSCO), in an online discussion hosted by the Official Monetary and Financial Institutions Forum (OMFIF) on 12th May 2022.

He believes that a global crypto guardian is the need of the hour, and a joint body could be constituted within the next year to conceptualise befitting regulations. "If you look at the risks we need to address, they are multiple, and there is a wall of worry about

After COVID and Climate Change, Adler mentioned that Crypto is the third 'C' for regulating authorities. He explained that pressing issues such as cybersecurity, stability and resilience, and data transparency needed to be looked into and that regulators have some catching up to do on those fronts.

Also read: Why is YouTube banning and unbanning crypto channels?

For investors, crypto regulation could actually be a good thing. A global watchdog could keep events like the Terra UST FUD from happening again and re-instil trust among crypto investors. "Regulations will come up, and they have to come up at some point, which would stabilise the market even further," said Tally Greenberg, Business Development Head at Allnodes, to NextAdvisor in April 2022. "That protects investors, so it's a good thing. It's not a bad thing," she added.

Crypto regulation has always been met with mixed reactions. For some, regulation hinders innovation and development in a decentralised ecosystem designed to work without a governing body. New regulation may also discourage long term investors from joining the crypto bandwagon, as observed in India.

However, it can also protect investors' financial interests while preventing malfeasance. Coins and projects may have to adhere to specific (maybe even stricter) security, privacy and fail-safe frameworks, which may only benefit investors in the long run.

Also read: Bitcoin mining difficulty at all time high – what is it and why is it important?