At the Davos Forum, CEO of the Circle Jeremy Allaire spoke of the need for new regulation of the crypto industry. He believes that countries such as the U.S. should develop legislative definitions for virtual currencies. He also believes that Blockchain technology should be seen as an operating system. The European Union is leading the way in developing rules to control digital assets, and MICA will take effect in a year. Aller continued, noting that there is currently a lot of confusion around how to manage virtual money, especially in the U.S., so new definitions of cryptocurrencies must now be worked out and adopted. This will benefit both cryptocurrency markets and their regulators.
The MICA rules are expected to help the cryptocurrency market in Europe prosper and be profitable when they go into effect, so Circle's own asset is likely to move from the U.S. division to the European division when that happens.
Last year, after the FTX bankruptcy, regulators around the world argued for stricter regulation of the cryptocurrency industry. In the United States, this has been a priority for the SEC.
The Financial Services Agency (FSA) in Japan also supported the call through its Bureau of Strategy and Management Development. Mamoru Yanase, deputy head of the bureau, said in an interview with Bloomberg that because of the size and growth of the market, it should be regulated similarly to the banking industry. He believes stricter regulations are necessary after the FTX bankruptcy, indicating a collective view among crypto industry participants and regulators that increased regulation can make digital assets safer and more transparent.
