The price of Bitcoin is still on the rise after the cryptocurrency started to gain value again in the recent weeks. The price of one Bitcoin stood at $11,500 on Wednesday morning. This was a significant increase compared to its price several days ago when it was $8,000.
Interestingly, all the other cryptocurrencies also gained value over the same period. For instance, the price of a single Litecoin shot up by over 50% in the past week reaching a new price of more than $240.00. Ethereum recorded a smaller increase moving to $950. Even Ripple enjoyed a significant increasing hitting $1.14.
New Regulations
This new development is coming at a time when most US lawmakers are considering a move to enact new rules and laws to govern what they term as “the highly volatile digital currencies.” Both Republican and Democrat lawmakers are in agreement that measures have to be put in place to address the high risks posed by virtual currencies to the financial system in the country as well as investors.
Bitcoin, which is the world’s largest cryptocurrency, fell below the $10,000 mark in January, which raised a red flag over its stability. This was the first time that the currency was trading below the $10,000 mark since November 2017. The currency lost almost 19 percent of its total value within 24 hours. The red-hot digital asset traded at a record high of $19, 783 in December 2017 before it started declining in value.
Even the free-market Republicans conservatives who are always wary of government decisions seem to agree with the lawmakers that the said regulation could be necessary if the cryptocurrencies were threatening the country’s stable economy.
Only a Matter of time…
According to Republican Senator Mike Rounds, it’s no longer a question of whether the country needs the regulation or not, but when the control should be implemented.
Carolyn Maloney, who is a senior Democratic member of the Senate’s Financial Services Committee, advocates for direct oversight of the digital currencies by the SEC. She says that the country lacks a specific law backing the use of the virtual currencies which is dangerous to the economy and the country’s financial system.
Although digital currencies have existed for years now, interest in them has recently increased along with numerous scams which promise investors abnormal returns of up to 1,000 percent in a few days or weeks.
The Threat of Hackers
In the modern world, hackers have also become active in the virtual currency sector, which led to the loss of up to $530 million of digital currency from the leading Japanese exchange Coincheck few weeks ago.
Tom MacArthur, another representative who sits in the Financial Services Committee, notes that the lawmakers are taking a keen look at the various cryptocurrencies to ensure that nobody is being exploited.
He argues that several regulators from all over the world have already raised the alarm over the virtual currencies saying that the digital currencies may aid money laundering and even terrorist funding. He further states that some consumers who have been exploited through the system have come forward complaining which undermining the trust in the global financial system significantly.
G20 Members Set to Discuss Virtual Currencies
Some of the G20 members including Germany and France have also come forward and requested to cryptocurrencies on the agenda of the upcoming G20 meeting. The G20 summit brings together some of the largest and most advanced economies in the world.
Conservative Republicans have also acknowledged the potential for broader risks. They say that although they hate regulation, they can’t sit back and watch the cryptocurrencies destabilize the American economy.
Representative Dave Brat, who is a conservative, acknowledges the need for a conversation over the need to regulate the virtual currencies. Early Tuesday, cryptocurrency investors were warned that they risked losing all of their life savings at any time due to the high-volatility of the digital money markets. Even the founder of Ethereum, 24-year old Vitalik Buterin fears that anyone who invests their money into these digital currencies risks becoming bankrupt instantly.
Regards,
Ethan Warrick
Editor
Wealth Authority
