When a revolutionary new development comes along, it invariably takes time for society to adjust to its presence. Not only do people have to understand its potential and overcome their resistance to change, but those in charge have to decide the new rules and regulations for it to follow - often without fully understanding the technology and its risks and benefits.
These rules and regulations are put in place to ensure public safety. Examples from history, misguided though they might be, can be seen for when the concerns were primarily about physical safety (such as the Red Flag Act of 1865) but, as we move further into the information age, safety measures are increasingly focussed on restricting obscenity and, now even moreso, financial protection. It is interesting to note however, that the development of some such laws is influenced by the interests of incumbent industries (for example horse carriage and rail when the car was rising in popularity) who historically oppose their upcoming competition and lobby against it, stifling its growth and delaying its proper implementation for years or decades.
Regardless of the intent behind them or the protections they seek to bring about, some jurisdictions have an influence that extends beyond their borders and when they make decisions, other countries may adopt identical positions or at least write their own legislation in a similar manner. A recent example of this can be seen in Africa earlier this year when Nigeria announced mass blockchain adoption was coming ahead of a number of other African countries such as Kenya and Namibia (as highlighted in our latest regulatory update coverage). As the largest African country in terms of population and economy, it was suspected that Nigeria’s decision would set the path for others to embrace blockchain technology and it certainly seems to have done so.
However, there are examples of this happening all round the world. Whilst the UK sets itself up to be a global blockchain and crypto hub to match its worldwide recognition as a financial industry leader, recent developments have noted that its policies will be taking the existence of the EU’s MiCA regulation into account (as mentioned in another article featured in our latest update). The countries of the EU are required to comply with its MiCA regulations and as one of the largest markets in the world, it can be expected that many more than the UK will consider the standards it sets when passing their own blockchain legislature.
Yet even as many look to European regulators, there are other outlooks, with the USA providing an example for countries who are still hesitant on crypto, though many recent developments could still be attributed to the downfall of FTX.
Whilst blockchain solutions are looking a little more positive in the states, the general outlook for crypto there is not so great, although many crypto enthusiasts hope that Ripple’s partial win over the SEC might change things. Nevertheless, with crypto being one of the driving forces behind blockchain and its development, the current treatment of it in the USA could see the country fall behind others like the UK and EU who are embracing the technology whilst still putting safeguards in place. Whether or not this will have adverse effects on the US’ ability to compete in the crypto and blockchain markets in the long term remains to be seen, but trends in other countries such as Canada, Japan, South Korea and others cracking down on crypto (particularly exchanges) might be at least partially responding to the US’ decisions.
The good news is that even if different countries have their own legislation to comply with, Blockpass’ verification solutions provide the perfect tools to quickly, efficiently and securely conduct KYC and AML whilst keeping the user in control of their data. A blockchain-agnostic solution, Blockpass can be used in a huge variety of different ways to enable organizations and businesses to comply with the relevant regulations for the jurisdictions they operate in.
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By Matthew Warner