CRYPTOCURRENCY | BTC | CBDC
US government regulations would almost certainly impede cryptocurrency sales.
Governments worldwide have taken various approaches to regulating cryptocurrency, with some countries (such as China) having instituted outright bans on it. While others are taking a more hands-off approach.
In the US, the regulatory landscape for cryptocurrency is still evolving, and various government agencies have taken different positions on how it should be treated.
For example, the Securities & Exchange Commission (SEC) has indicated that some cryptocurrencies and initial coin offerings (ICOs) may be considered securities and, therefore, subject to federal securities laws.
Also, the IRS has issued guidance on taxing cryptocurrency transactions (most of it is as confusing as the rest of their regulations). These and other regulations could make it more difficult for companies to sell cryptocurrency and for individuals to purchase it.
What Is BTC?
Almost everyone, whether involved in cryptocurrency or not, knows what BTC is. But just to be sure, here’s an expert definition from a leading financial magazine.
“Bitcoin is a decentralized digital currency that you can buy, sell and exchange directly, without an intermediary like a bank. Bitcoin’s creator, Satoshi Nakamoto, originally described the need for ‘an electronic payment system based on cryptographic proof instead of trust.’
Every Bitcoin transaction that’s ever been made exists on a public ledger accessible to everyone, making transactions hard to reverse and difficult to fake. That’s by design: Core to their decentralized nature, Bitcoins aren’t backed by the government or any issuing institution, and there’s nothing to guarantee their value besides the proof baked in the heart of the system.” — Forbes.
However, like any investment commodity, like gold or diamonds, the only reason they are valued is the importance, or worth buyers have placed on it. That worth for BTC and altcoins might be hindered by the government’s creation of a centralized digital currency.
BTC to USD Price Data
“The live Bitcoin price today is $22,981.24 USD with a 24-hour trading volume of $25,289,660,785 USD. We update our BTC to USD price in real-time. Bitcoin is down 0.04% in the last 24 hours. The current CoinMarketCap ranking is #1, with a live market cap of $442,941,186,047 USD. It has a circulating supply of 19,274,037 BTC coins and a max. supply of 21,000,000 BTC coins.”—Coin Market Cap.
The maximum supply of BTC is set to 21 million. That means there will never be more than 21 million BTC. That also could add value according to the law of supply and demand.
BTC to USD All-Time Chart
How Would the US Government Issuance of a Central Bank Digital Currency (CBDC) Affect Bitcoin Sales?
“CBDC is generally defined as a digital liability of a central bank that is widely available to the general public. Today in the United States, Federal Reserve notes (i.e., physical currency) are the only type of central bank money available to the general public.” — The Federal Reserve Board.
It is difficult to predict exactly how the issuance of a CBDC by the US government would affect Bitcoin sales.
It depends on various factors, such as the specific features and design of the CBDC and the broader economic and political conditions.
However, introducing a CBDC could potentially decrease or destroy sales for BTC and other cryptocurrencies, as it would provide a digital alternative to cash that is issued and backed by the government.
This could lead to a decrease in demand for BTC and potentially decrease its price. Additionally, the CBDC could be integrated into the existing financial system, making it more accessible and user-friendly than cryptocurrency, which could also lead to decreased demand for BTC and altcoins.
However, the CBDC wouldn’t be much different than the fiat dollar, as the government would still control how many were “minted” and circulated. The circulating supply would still be controlled by a central figure, and the max supply would be impossible to determine, just as it is now with the USD.
What are your thoughts on government control of cryptocurrency?
- Do you favor a more convenient CBDC than the USD, much like China has done with the digital Yuan?
- Would you be in favor of giving up the freedom and privacy of the decentralized finance concept to gain it?
Final Argument
Let’s keep the government and big banks out of our financial business as much as possible.
We live in the Philippines, but when I was in the US last year, I tried to send my wife money in the Philippines, the bank wanted $50 to transfer it to our joint account.
Western Union wouldn’t send it to her because I couldn’t produce proof that she was my wife (we were married last and she still has her maiden name on her accounts and IDs), and if they did, it would cost $32.
After struggling with this for three days, I bought USDT is our crypto account, and she withdrew 21 minutes later. The fee? Twenty-five cents.
DISCLAIMER: This article is for entertainment and informational purposes only. It should not be considered financial or legal advice. Not all information will be accurate. I am not a financial adviser, and you should consider anything I write as informational and friendly banter to show you what is possible if you invest your money in these vehicles. However, there are no guarantees. Consult a financial professional before making any significant financial decisions.
Note: This post contains affiliate links. Read my disclosure statement for additional information.
Stephen Dalton is a retired US Army First Sergeant with a degree in journalism from the University of Maryland and a Certified US English Chicago Manual of Style Editor. Also, a Top Writer in Nutrition, Investing, Travel, Fiction, Transportation, VR, NFL, Design, Creativity, and Short Story.
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