What Happens When You Lack Regulation

Whilst the original narrative around cryptocurrency was built up to be one of anonymity and anarchy, the section of the bitcoin whitepaper dealing with privacy was only two short paragraphs long, and the level of privacy was equated to that of a stock exchange. Like a stock exchange, and in keeping with its original goal of facilitating financial transactions in a trusted manner without relying on financial institutions, the true potential of cryptocurrency still requires the existence of regulations, in order to safeguard users and ensure trust can be had in the system.

The crypto sector has experienced significant setbacks due to insufficient regulation or ineffective enforcement of existing rules. A notable example is the involvement of FTX’s Sam Bankman-Fried in fraudulent activities and money laundering through his platform, which triggered a market crash. This event had a ripple effect on all industry-related entities, and recovery has only recently begun. Less than three months ago, Changpeng Zhao’s admission of guilt to money-laundering charges cost himself $50 million and Binance more than $4 billion. Ultimately, the unscrupulous activities of prominent crypto platforms cost not only money, as the crypto markets lose value from the loss of trust, but also time and opportunities for those who work in or adjacent to the sector such as blockchain developers, researchers, investors and startups.   

One place where a call for regulation has gone out is Nigeria. Cointelegraph recently reported that Adedeji Owonibi, co-founder of A&D Forensics, a blockchain intelligence service provider, underscored the need for the Nigerian government to ensure compliance measures and specialists in its employ are up to the role of combating financial crime. Without appropriate safeguards, criminals benefit from the lack of oversight and law-abiding citizens and businesses suffer. Owonibi stated: “Nigeria should completely regulate cryptocurrency activities within the country and set out laws to that effect because if there is no law, there is no offense.” 

When such regulations are put in place, a greater level of trust can be placed in the crypto and blockchain ecosystems, which not only benefits those seeking to use them for legitimate financial transactions without the inefficiencies of third-party institutions, but also allows the space to grow as more people feel secure to utilize it and develop further solutions or generate more business. However, it is not enough to just have regulations; there needs to be a way to enforce regulations and for companies and businesses to demonstrate that regulatory standards are being adhered to. 

This is where Blockpass has the ability to help all those in need of strong, secure and efficient compliance methods. With experts in regulation and compliance, the Blockpass team builds, maintains and continuously develops innovative regulatory compliant solutions, like KYB reshareability and the Auto KYC BotTM, that can be utilized by professionals and individuals in any jurisdiction to ensure they not only meet compliance standards, but can demonstrate that fact. With a Blockpass ID, users can instantly onboard with any entity in Blockpass’ ecosystem as they have proof of compliance that can be shared with the tap of a button. 

About Blockpass

Ditch tedious onboarding and say hello to seamless compliance with Blockpass, the ultimate turnkey solution for KYC, KYB, and AML. Experience the market's most efficient and cost-effective compliance suite, built by seasoned compliance veterans and crypto-natives. Automate compliance processes, eradicate fraud, and onboard globally with confidence. Verify businesses worldwide, launch bank-grade verification for your organization, and instantly activate compliant KYC/AML for DeFi, exchanges, token launchpads, NFT mintings and beyond. Through Blockpass’ decentralized network of a million pre-verified crypto-enthusiasts and a thousand pre-verified businesses, you can expand your reach effortlessly. Leverage Advanced KYC BotTM for intelligent remediation, On-Chain KYC® for data-free anonymity, and Unhosted Wallet KYCTM to meet Crypto Travel Rule regulations. Join Animoca Brands, Cardano, Polygon, Chainlink, Delta Exchange, National Geographic, TinyTap, Seedify, ChainGPT, Iskra and many more in partnering with Blockpass for compliance you can trust, growth you can accelerate and an experience you can enjoy. Join the cutting edge of secure, streamlined onboardings.

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By Matthew Warner