Bitcoin and other cryptocurrencies were developed in the 2008 global financial crisis. Bitcoin uses a decentralized, peer-to-peer computer network to track transactions and balances. These transactions are broadcast to the network. And these are also recorded in a digital public ledger called the blockchain. The web is complex and designed to be decentralized. So it cannot influence or control by any central authority. The trading of Bitcoin and other virtual currencies is a global phenomenon. Despite regulation in specific markets, trading activity continues to speed up. The cryptocurrency market has grown since Bitcoin was first created.
China’s concerns about crypto transactions
China has banned cryptocurrency many times during the recent 20 years. China’s government agencies have raised concerns about bitcoin and similar cryptocurrencies. Analysts say that China sees cryptocurrency as a threat to its national currency. According to the Chinese government, Crypto transactions pose a threat to money laundering. It is a threat to people’s assets. For this reason, China’s central bank has prohibited its circulation in the market.
But in the past, China was the biggest market for crypto transactions. So it wouldn’t be a surprise if it bounced back again.
USA concerns about crypto transactions
The US has been very slow to create crypto regulations compared to other nations.
Cryptocurrencies are also crucial for both central and state governments in the USA. The sale of cryptocurrency is only allowed if the deal follows federal or significant law. Also, FATF published these guidelines in June 2019. FinCEN requires crypto transactions to follow record-keeping requirements.
The United States will dominate the market. The opportunity in the US is estimated to be worth $7.7 trillion. The only problem with the US is that we already have a lot of regulations. And in most cases, it’s not in favor of cryptocurrency and blockchain technology.
In the US, cryptocurrencies are still not considered money or currency. And also are not subject to taxation or regulation. US treasury said crypto rules need to combat domestic and global criminal activities.
Decentralized finance is attracting lots of attention. But, regulation and confusion make cryptocurrency seem like a nightmare. If you know how to use them, cryptocurrency and Defi can be your best friend. The Defi and DEX trend is a direct result of the crypto ban and regulation.
There are a lot of rules and regulations around cryptocurrencies. The masses are still adopting the technology behind them. In the future, if the laws aren’t as inhibiting as they are right now. That decentralized exchange will be the norm. Despite the crypto winter and regulation, Defi and DEX volumes are surging.
At the same time, the markets suggest that the crypto winter continues. Defi and DEX volumes show that it is far from over. We expect this trend to continue. So, decentralized Exchanges have a long way to go. But there is no going back in the crypto world. So it is essential to understand what they are and how they function.