The Death of Global Crypto
The list of countries that are restricting crypto is growing. Nine months ago, there would have been about ten countries on the ‘limited’ list. I just saw a list for a US based bounty programme and it had grown to twenty-five (and now we need to add Malaysia! Twenty-six!)
The following countries and locations are not able to participate in this bounty:
Algeria, American Samoa, Bangladesh, Bolivia, China, Egypt, Guam, Iran, Iraq, Kuwait, Marshall Islands, Morocco, Nepal, North Korea, Oman, Pakistan, Puerto Rico, Qatar, Saudi Arabia, Sudan, Syria, Thailand, US Territories, US Virgin Islands, United States.
Twelve months ago, the crypto world rejoiced in its ‘global’ nature — the truly digital asset market (digital = no borders) where investors traded globally. ICOs were promoted globally and media flowed globally.
Of course that idea was doomed, much to the horror of the libertarians who hate the interference of national regulators; and the ignorance of people who can’t handle operating ‘globally’, yet that’s not how the investment market works.
In the first crypto wave, 2010–2018, the crypto market was global. In the second crypto wave, 2019–2021, the crypto market will be ‘local’.
The reasons are simple:
- 99% of financial institutions don’t invest internationally
- 99.99% of retail investors don’t invest internationally
- Regulators want to regulate markets, so new laws are limiting
- The world is very wary and will be constantly warned about ‘foreign investment opportunities’, killing any potential resurgence of the global ICO market
There will always be an ‘international’ market, if only for those who do not want to be impacted through taxation or questions around the ‘source of funds’. There is $500bn in black money every year. There is $20trillion+ in tax havens. So an international exchange like Binance, based in Malta, lightly regulated, operating in crypto-crypto and sponsoring lots of lightly regulated issues, could easily do $10bn per day in trading.
But the big money in investing/trading will be on major regulated platforms which will be launched by companies behind NYSE, NASDAQ, Deutsche Borse, Singapore Stock market etc. I expect every major stock exchange and a number of the largest brokerages and banks to announce their institutional focused exchange platforms in 2019. These will be heavily regulated, yet trusted platforms.
In my opinion, this will kill off most of those exchanges in the world who are targeting institutions (or they will be bought) and then there will be some FX style exchanges for traders and some small cap exchanges focused on the retail market/crowdfunding (Dacxi).
What does this mean to you?
