Cryptocurrencies are developing at an immeasurable scale, with hundreds of cryptocurrencies being released every month and many looking to invest. With non-supporters labelling most projects a scam irrespective of their legitimacy, many are left questioning which projects are safer and which shouldn’t be trusted?
A recent YouGov survey has shown that the vast majority of respondents—75%, in fact—favour more regulation and a proven track record of performance from crypto projects before getting involved in the crypto space. Regulation in the crypto space is both an essential and inevitable step to increasing wider public adoption, trust, and stability. However, many people within the crypto industry believe that such regulation should not be imposed by government bodies, but that the industry should self-regulate through the formation of independent advisory panels.
Guaranteeing safety measures for investors shouldn’t be a hard task, but it becomes somewhat impossible given that, as of March 2022, there were over 18,000 cryptocurrencies in total. Surprisingly, only 0.01% of those currency projects are licensed and regulated. These drastically low percentages leave many in the crypto industry looking to regulation to move forward.
Regulation could lead to an inevitable increase in new stakeholders and a large increase in the overall crypto market capitalisation. 24.1% of the UK adult population (13 million out of 54 million) has an individual savings account (ISA) and it is estimated that globally 3.3 million of the adult population owns cryptocurrency. With time and regulation, there could be a potential 400% increase in uptake of the UK adult population involved in cryptocurrency, dramatically increasing crypto’s overall market cap.
However, as it stands, the crypto space is littered with many failed crypto projects. It is estimated that up to 90% of crypto projects fail. There are many reasons why—for example, a project could fail to gain any traction or build a solid community. Yet every time a crypto project fails, it results in either bad press and/or a loss of stakeholders’ money. It also undermines the entire crypto community, which in turn deters new stakeholders from entering the space for fear of losses by being scammed, poorly managed projects, or just lack of trust.
The more unregulated cryptocurrencies that enter the crypto space, the more potential investors will change their minds and invest elsewhere. This constant overload of unregulated crypto leads to negative daily headlines about cryptocurrency scams, and the rising popularity of digital currency also can mean that other traditional money cheats are overlooked. These include credit card fraud, insider trading, market manipulations, bank account fraud through identity theft, and old-school heists.
Understandably, the swarm of tokens and coins and recurring scandalous news stories can quickly put investors off from buying and selling. It can also result in investors losing interest in crypto altogether. But it is important that the entire community steer clear of adopting the stereotype that all cryptocurrencies are untrustworthy, as it would damage the reputation of tokens and coins that are actually, legitimately safe.
As CEO and co-founder of ETHAX—one of the few regulated crypto businesses in existence—I’m a passionate believer that digital currencies are our future, and can be sound, profitable investments if using an informed approach. In a landscape of so many big-talking “crypto rogues,” our company stands out from the competition as a trustworthy institution making it safer for investors to buy and sell crypto. ETHAX has been established as a long-term crypto business to counter all the aforementioned undesirable issues.
One of ETHAX’s key service features is that it is licensed to convert fiat money (GBP, $, Euro) to cryptocurrency, as well as the reverse— cryptocurrency to fiat. This is a key step in the cryptocurrency process, through which traditional, government-backed money and the crypto world are linked. This aspect of conversion is very important and requires a lot of trust and compliance with European Anti Money Laundering Regulations. It’s key that, if entering into the crypto space, that you do so armed with a full understanding of the complexities behind such nuances to keep your investment safe.
For anyone new to crypto looking to get involved, here are five key tips I recommend to get you started:
- Read up on crypto generally, just to understand more than you already do—ignorance is never bliss, and it’s always best to edify yourself rather than taking someone else at their word.
- Every business has its own language; familiarise yourself with key crypto terms for each.
- Join a community like the ETHAX Crypto Official Chat—you will only learn by asking questions!
- Ensure that you’re using licensed and regulated companies. This is easier said than done, but remember: if it looks too good to be true, then it probably is. Check their website, social media, and white paper trail.
- Like everything in life, the value of crypto can go down as well as up, so don’t purchase more tokens and coins than you can afford. Holding crypto over a longer period is a great strategy.
To answer the initial question posed by this article’s title: no, trustworthy, regulated cryptocurrencies are not a myth. However, they are hard to find. With thorough research and a good understanding of what is safe for your investment, investors will be able to have a positive buying and selling experience. You can even look out for free crypto to get you started, like here.
Just make sure to look out for the safest cryptocurrencies, and good luck with your investing!