How States Strive To Protect Their Nationals When It Comes To Crypto Trading

How States Strive To Protect Their Nationals When It Comes To Crypto Trading

So you might have known that crypto trading is an unregulated undertaking. Crypto operations, for one, have been designed to be free from government intervention. It is for this reason that states as much as possible would keep a distance. They are only expected to step in when the welfare of their nationals are concerned. Learn more about how states strive to protect their nationals when it comes to crypto trading.

Nature of crypto operations

Cryptocurrencies, not like any traditional financial instruments, have a class of their own. It is an intangible asset operating through blockchain technology responsible for crypto creation and accounting. Although it is not a physical asset, high regard is being placed by investors in this asset as a source of potential passive income opportunities. Thanks to the profitable price behaviour that turned the very first crypto coin from a mere medium of exchange to an investment unit.

The founder of Bitcoin, who started it all, developed the cryptocurrency as an alternative to traditional fiat money. It has suddenly gained relevance as an investment unit after its surge in prices. Imagine how this crypto coin has gone through the roof all these years. And it is not likely to stop anytime soon. This is the reason why more and more investors are becoming interested in crypto trading.

Be that as it may, crypto operations make use of a decentralised system. It prides itself in operations free from any third-party intervention. This is why crypto trading has been independently operating from the traditional financial system. As it is completely autonomous, the crypto market operates in a free market.  Even the government has maintained a neutral stance throughout the years. They would stay away from crypto operations so as not to disturb the environment.

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Be that as it may, it is noteworthy that crypto operations involve a lot of risks. Major risks are characterised by cybercrimes, from theft to money laundering. This is why the authorities have also been closely monitoring the crypto ecosystem to ensure that these criminal perpetrators would stay away for good. Governments are making ways to ensure that their nationals are safe from these cyber fraudsters to enforce law and order even in the crypto community.

How government intervenes

States would vary in their approach when it comes to crypto regulations. One has decided to monopolise the system by prohibiting cryptocurrencies and introducing its digital currency. You might have heard of China banning crypto players from paving the way for its digital banknote. And they are expected to continue building up the crypto coin’s value by introducing it to the global platform soon. Meanwhile, it has successfully been launched in the local market with several participating merchants.

Some governments have limited their intervention to the enforcement of local laws. The United States has been tolerant about crypto operations, with Bitcoin already placed outside of its radar of the Securities and Exchange Commission. However, Ripple was not able to get the same treatment with the recent legal suit for non-registration. The crypto community is now waiting for the landmark decision that would change the game in the industry.

Some countries have remained progressive. For instance, Japan has created laws to regulate crypto exchanges after the huge crypto scam that rocked the country several years ago. The state has implemented regulatory measures to ensure that only legitimate crypto trading developers would be able to get into the industry. It is important to put an extra layer of protection in crypto operations to avoid the perpetration of fraud. This way, the state would be in a better position to protect its nationals.

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With the exercise of police power, states can endeavour to ensure the safety and security of their nationals, as well as the latter’s assets. It is for this reason that every state would make a reasonable intervention when criminal activities are already involved.  No wonder it tends to be unstoppable in imposing regulatory measures to prevent cyber attacks. All it needs is cooperation from investors and crypto trading operators.

Measures were undertaken by governments

Most states would promote some policies that would help keep the crypto ecosystem safe from criminal elements. Whether it is about fraud or money laundering, some protocols are being undertaken to make sure that the platform will not be used by criminals for their profit. Remember that the crypto niche has been developed not to accommodate fraudsters but to help improve the chances of regular people achieving financial freedom.

States would encourage the so-called know your customer policy. Crypto exchanges, like the Immediate Edge, are advised to conduct some verification of the identity of the account owner. In the registration process, an investor would be required to submit some identification documents to verify his or her identity. This would make it hard for criminal perpetrators to use fictitious names. Nonetheless, this is not a guarantee of legitimacy. This is why crypto exchanges are expected to work closely with law enforcement agencies to be able to secure assistance.

From time to time, the government would also issue warnings to keep the public aware of the latest crypto modus operandi. You would not want to miss out on the red flags associated with some crypto scammers. By all means, keep yourself updated with the bulletin issued by the police. These materials are readily accessible on websites with a click of a finger. Yes, you can practice due diligence by simply keeping yourself aware and vigilant over what the authorities have to say.

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Of course, there are also local penal laws in place to go after the perpetrators. There are local law enforcement authorities tasked to investigate cybercrimes that would include fraudulent activities in the crypto market. While the process may take a while, rest assured that they will do their best to catch the perpetrators. The responsible people will then be charged for the crime committed so that they can also be punished accordingly.


These are only some of the illustrative examples of how states strive to protect their nationals when it comes to crypto trading. Nonetheless, it is also incumbent upon the crypto community to do their share of diligence on the matter.

Ayhan Fletcher

"Subtly charming zombie nerd. Infuriatingly humble thinker. Twitter enthusiast. Hardcore web junkie."

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