Why does the government ban Bitcoin (Why does the government ban Bitcoin?)

Why does the government ban Bitcoin Original author: Cointelegraph

Translation: 0x711, BlockBeats

The emergence of Bitcoin (BTC) has brought about a new revolution. From governments to individuals, the development of cryptocurrencies has undergone significant changes. Globally, people are paying more and more attention to decentralized finance and blockchain technology. How are these innovations achieved? Why ban Bitcoin? Why is it like this? Why not allow its use for transactions? In order to address this issue, governments around the world have begun implementing regulations on the growing demand for digital assets such as Bitcoin. However, due to the lack of proper management, control, or regulatory frameworks in many countries, the laws in most countries are not that clear.

Nevertheless, Bitcoin is still a powerful ecosystem – a network composed of various entities. These include the Bitcoin Cash protocol, Ethereum, and various other tokens. Therefore, most of these networks are open source.

According to data from the U.S. Securities and Exchange Commission, from January 2017 to 2021, a total of about 50,000 participants registered over 350,000 Bitcoin accounts. However, since 2019, there has been no new funding into the platform; data from the first quarter of 2020 shows that less than 1% of Bitcoin investors have a significant portfolio. Therefore, in the past three years, only about 30% of people hold a large amount of Bitcoin.

Although some experts believe that if this situation occurs, a faster “deflationary” mode will emerge – over time, this mechanism may become more powerful. However, some people are also concerned that if nothing is used as a means of payment in the coming years, this trend will not be sustainable. What is the correlation between the price of Bitcoin and its value? Currently, there are two obvious correlations. The first is the mining output. The second is the change in block rewards. When you see miners selling their cryptocurrencies, it will cause another price change; the third is exchanges. Exchanges need to provide services through third-party brokerage companies to obtain customer information, and then they must send money to the exchanges to provide better security for their users; the fourth point is the lack of transparency.

Just as information about Bitcoin around the world, governments have been working hard to combat illegal activities that attempt to hinder certain cryptocurrencies, especially those criminals who have entered emerging markets but are still in their infancy. In fact, in the United States, almost all states are taking similar actions to combat fraudulent activities. For example, Estonia is establishing an uncensored market to disclose all details of such cases to the public and report them to the House hearing.

In recent weeks, the U.S. President Joe Biden tweeted, “I love cryptocurrency very much.” He pointed out that this is a large-scale technological update. “Now,

Why does the country ban Bitcoin

Editor’s note: This article comes from Interchain Pulse (ID: HiveEcon), author: Yuan Shang, Odaily Planet Daily authorized reprint.

According to reports, the U.S. federal government has recently issued a “ban” on Bitcoin, prohibiting its buying and selling at the national level, and regulating and investigating it as an illegal financial tool. According to the source, “If Bitcoin does not receive support from legal use or trading platforms, it will be sanctioned.” However, these accusations are actually based on two facts: first, Bitcoin is a highly speculative asset; second, due to the lack of regulatory certainty, most investors cannot obtain any form of return or risk exposure. In addition, there are also some illegal activities in various countries, such as using false information and fraud to obtain funds, resulting in huge losses.

These two situations are implemented by different institutions: “To protect user data security, we must take measures to make it easier to trace.” And in fact, for other entities that consider cryptocurrencies as commodities and services, this is not the case: “What I do is to let them know that what they are buying is some kind of product so that they can better understand whether the products behind them comply with our legal framework.” But from another point of view: Although Bitcoin is not legal tender but a payment method, and it has certain advantages, such as not being controlled by central banks. However, when it comes to digital gold, this issue seems to have become more serious.

Earlier this year, there were reports that Elvira Nabiullina, the head of the Central Bank of Russia, called for a comprehensive ban on Bitcoin and other digital tokens. “This is a completely wrong choice! Because Bitcoin itself is not suitable for ordinary people to use for daily consumption. So if you put your money in cold storage or use it as an investment tool, then you are too dangerous!”

Although Bitcoin is not a real virtual property, in the past few years, this trend has changed, and it is increasingly changing over time, and people have begun to notice this. Now, many people in the world still hold and use BTC and other cryptocurrencies, and even their own Bitcoin is no longer affected. Citizens of multiple countries, including Venezuela, are waiting for this day.