Nigel Green, founder of deVere Group and long-time advocate of cryptocurrencies, has called for greater regulatory scrutiny of the sector, with cryptocurrencies set to play a “greater role in the international financial system” going forward.
According to Green, a strong regulatory framework at an international level would help protect investors, tackle cryptocurrency criminality and reduce the potential possibility of disrupting global financial stability, while potentially boosting the economies of countries who introduce it.
Green’s comments come after both the Financial Conduct Authority and the president of the European Central Bank called for more robust regulations for cryptocurrencies.
The price of Bitcoin rose more than 300% last year and gained a further 40% earlier this month to reach an all-time high.
Green says: “The calls by financial watchdogs and central banks for greater regulatory scrutiny must be championed as digital currencies, including Bitcoin, are set to play an ever greater role in the international financial system.
“There is a sustained and growing interest in the likes of Bitcoin from both retail and institutional investors. They are now increasingly handling the assets as they would any other asset in the portfolio – sometimes profit-taking, sometimes reinvesting, using the volatility to their advantage and using these alternatives to help with all-important diversification. These mainstream investor strategies demonstrate that cryptocurrencies must come into the regulatory tent and be held by the same standards as the rest of the financial system.
“What’s needed is a strong regulatory framework to be established and approved at an international level. The forthcoming UK-hosted G20 summit might prove to be the ideal opportunity.”
Green previously said one of the best ways to address the regulatory issues is via the exchanges, with nearly all foreign exchange transactions going through banks or currency houses.
Green added: “When flows run through regulated exchanges, it will be much easier to tackle potential wrongdoing such as money laundering and make sure tax is paid. For this to happen, banks will need to open accounts for exchanges which is why they must be regulated.
“Cryptocurrencies in some form or another are here to stay and the market is only set to grow. There can be no doubt that regulation of the crypto ecosystem is required and I believe, should be a priority.”
