Crypto Adoption Through Regulation: Setting Rules for Centralized Exchanges

While some security issues exist, major internet outages like the one seen recently in the EU can't really threaten cryptocurrencies or their associated networks.

Centralized cryptocurrency exchanges have become the backbone of the nascent crypto ecosystem, paving the way for retail and institutional traders to trade cryptocurrencies despite the constant fear of government crackdowns and lack of support from decision makers.

These crypto exchanges over the years have managed to put in place self-regulatory controls and implement policies in line with local financial regulations to grow despite the looming uncertainty.

Cryptocurrency regulation continues to occupy mainstream debates and expert opinion, but despite public demand and demands from stakeholders in the nascent ecosystem, policymakers continue to overlook the growing sector fast that reached a market cap of $3 trillion at the height of the rally. run in 2021.

Over the past five years, many local and national governments have shown interest in regulating the crypto market, but have often been perplexed by the vast ecosystem and complexities of regulating certain decentralized aspects of the crypto market. market. As a result, most governments that have issued crypto-related guidelines or rules have done so based on existing financial regulations, but market developments have proven to be too fast.

Some countries have moved to recognize crypto trading as a legal activity, while others have approved Bitcoin (BTC)-based exchange-traded funds. Many countries have also made way for crypto platforms to operate with a license, but the strict requirements often deter some smaller platforms from staying away. Therefore, there is no one-size-fits-all blueprint for regulators to adhere to, and experts believe that leading centralized crypto exchanges can change that.

In traditional markets, it is perfectly normal for regulators to work closely with industry players, including exchanges, to ensure that regulations and guidelines work well and keep pace with technological advances in rapid evolution. However, the same cannot be said for the crypto market, as regulators have maintained a safe distance from the fledgling industry.

Oliver Linch, CEO of global crypto exchange Bittrex Global, said the...