'Where do you rule the line?” The push to regulate the wild world of cryptocurrencies is raising all sorts of curly questions for policymakers. | OPINION by clancyyeates
Watching State of Origin last Sunday night, it was hard to miss the cryptocurrency advertising. Just as the AFL and other sports have lucrative sponsorships from crypto firms, the NRL has a partnership withIt’s easy to see some similarities between high-risk cryptocurrency trading and sports betting - another
It’s been a wild year for crypto investors, with Bitcoin prices plunging 58 per cent this year to about $US20,000. At the same time, governments everywhere are grappling with how to fit these privately-issued digital assets into some kind of regulatory framework.The federal Treasury has been consulting on the topic recently, and the process has raised some interesting questions.
He says when you’re buying Bitcoin, the chances are you’re doing it not to make a payment but because you believe someone will be willing to pay you more for the Bitcoin in the future. Davis concedes that’s different from other forms of gambling, where the outcome of a horse race or a sporting match determines the gain or loss. But he sees it as gambling all the same, and likens the digital currency exchange that allowed you to buy Bitcoin to a newsagent selling lottery tickets.
“They should think very carefully about what bits of [the crypto sector] are treated as a financial product, and what bits are just pure gambling,” Davis says. Someone with plenty of expertise in both digital finance and regulation is Greg Medcraft, the former chairman of the Australian Securities and Investments Commission, who also led the OECD’s financial services directorate, where digital finance was a key priority.