This is the time of year: individual events must be abandoned in favor of year-ends, big stories and annual lessons. With many governments around the world finally having to contend with the burgeoning digital financial landscape, the year has been eventful in cryptopolitics and regulations beyond a brief summary. However, one can try to highlight some of the major trends that have come to the fore in the last 12 months and will continue to shape the relationship between society, government and the crypto space as we approach 2022.
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The US Congress takes notice of cryptocurrency
In 2021, the regulation of cryptocurrency in the United States will to a large extent no longer be reserved for non-elected officials who sit on the various financial regulation committees and the Ministry of Finance. Federal lawmakers have called for more high-level congressional hearings on digital assets than in any previous year. Their knowledge of coding issues has also improved significantly. The executive branch is still struggling to make important decisions – an approach most evident in the inclusion of last-minute reporting requirements for cryptocurrency brokers – but it is possible that proponents of such a course have been surprised by the vocals. and coordinated resistance from industry. and its allies on Capitol Hill. Of course, not everyone in Congress is a fan of bitcoin, but there are still quite a few of them, and some of them make cryptocurrency prominent on their legislative agendas.
The emergence of cryptocurrencies as a prominent public policy issue in a time of party political polarization has also raised the question of where each of the two major political parties in the United States deals with issues related to digital assets. Next year, there will most likely be a further crystallization of the party’s crypto attitude.
Autocrats tend to take a hard line
Another new dichotomy can be seen in how different political systems treat cryptocurrencies depending on where they are in the authoritarian liberal chain. It is clear that all authorities are looking to maximize their degree of control over the payment systems and the financial system as a whole, but by 2021, those using the free market are likely to be more likely to take over the digital asset space than to limit it sharply.
The approach introduced by China and its ban on cryptocurrency trading and mining represents an oppressive end to political rule. The alternative is openness to financial innovation and the benefits of this openness through limited supervision.
The conflict between these two positions is escalating in many large economies, which can reasonably be expected to choose the most severe scenario. While the imminent threat in India appears to have been averted, vague signals from Russia and Turkey suggest that harsh powers have an unusual influence there.
Unique degree of legal influence
From El Salvador, which became the first cryptocurrency with Bitcoin (BTC) legal tender status, to the US Securities and Exchange Commission, which finally allowed a Bitcoin ETF to enter the market, more people now have a legal way to use cryptocurrency for payments than ever before. ever and investment.
However, the narrative changes caused by this historical development reason far beyond the cryptocurrency bubble, triggering new waves of public interest. As awareness and exposure increase, it is becoming increasingly difficult for decision makers to ignore the new economic and social reality in which Bitcoin and its siblings live in the lives of millions. Right now, there is no way to stop the good cycle of global adoption of cryptocurrencies, and by 2022 there will be fewer opportunities for governments to ignore crypto-driven social transformations.
