Regulating the Crypto Wild West
The explosive growth of cryptocurrencies and digital assets has left financial authorities scrambling to understand what is going on. But though this burgeoning sector is known for its frontier spirit and commitment to innovation, plenty of the risks it poses should already be familiar to regulators.
A well-functioning financial system is a key component of any successful economy. Without efficient payments and broadly accessible financial services, people cannot engage easily in commerce, save for a rainy day, invest in new innovations and business models, or insure against risk. But precisely because the financial sector is so central, developments within it are highly consequential. If the digital revolution has shown us anything, it is that one seemingly minor innovation can upend or even eliminate entire industries.