By: Mary Kavaloski
The advent of Bitcoin in 2009 presented a previously unfathomable possibility for the future of currency and monetary transactions. Now, cryptocurrency is ubiquitous; it is increasingly seizing media headlines, novel swathes of investors, institutional bank involvement, and most importantly of all, the attention of government regulators. Yet governments around the globe have failed to adequately keep up with the pace of cryptocurrency’s evolution, particularly because of their lack of expertise in this unprecedented area.
This Note discusses how cryptocurrency’s truly global footprint warrants a partnership between national regulators and industry actors at the international level. Specifically, by exploring the approaches of Japan, China, the United States, and the European Union against the functions and purpose of the international financial regulatory system, this Note argues that the current approaches to global crypto regulation have overly prioritized crypto’s effects on traditional financial markets while overlooking the unique role crypto exchanges can play. A common goal towards establishing a meaningful framework grounded in investor protection, reliability, and innovation has thereby been undermined, despite the alignment between the international monetary system’s strengths and its capacity to create a global crypto framework.
This Note proposes the creation of a specialized cryptocurrency group based on, or molded into, the successful Basel Committee on Banking Supervision, to show how a newly formed partnership between regulators and exchange leaders can establish the future of a sustainable cryptocurrency ecosystem.