Cryptocurrency is no longer regarded as the currency of the future. Due to more countries recognizing crypto as legal tender, Bitcoin and other popular coins are the currency of today. Therefore, it’s no surprise that Italy adopted virtual currency as a viable payment option.
However, with more of its citizens slowly choosing crypto as their preferred currency, the Italian government sees the need to regulate its use. Although crypto boasts of a $1.6 trillion market, Italy doesn’t plan on waiting for the European Union to regulate the use of crypto on the region’s behalf.
So, what reasons does Italy give on why there is a need for regulating crypto within its borders?
Reasons Why Italy Plans on Regulating Its Crypto Market
1. To Curb Any Criminal Acts Involving Crypto
Because of the untraceable nature of cryptocurrency, it can attract a lot of criminals. Such unscrupulous individuals may want to use the virtual currency to evade taxes, launder money and even conduct illegal activities.
The chairman of the Commissione Nazionale per le Società e la Borsa (CONSOB), Paolo Savona called for the regulation of cryptocurrencies through changes in policy. He fears that market transparency, rational choice, and basis of legality will worsen over time for market operators. He adds that CONSOB has closed down hundreds of Italian websites that used crypto for criminal activities.
2. To Regulate Crypto Instead of Banning and Prohibiting Them
With all the problems that come with accepting cryptocurrency as an acceptable means of trade, some countries have banned or prohibited its use. However, Italy understands the importance of crypto and intends to follow El Salvador’s lead by regulating the virtual currency. An all-out ban would be counterproductive as it would be seen as stifling technological advancement.
With the introduction of new laws that could help mitigate some downsides of using crypto as legal tender, Italy would reap the financial benefits with minimal downsides. This would also help to quiet the crypto critics in the government and around the world.
3. Protect Its Citizens From Losing Their Investment
More altcoins are coming up every day and are performing well in the crypto markets e.gBaby DogeCoin (BABY DOGE). Paolo Savona says that there are over 4,500 cryptocurrencies currently in circulation and more will come.
With regulation, the Italian government might be able to protect its citizens from currencies that are not legitimate. For example, CONSOB suspended a British company’s Initial Coin Offering (ICO) in 2018 that violated the rules on public offerings of financial services and products.
The policy could include a list of cryptocurrencies that the government approves their use in the country. If the citizens follow these guidelines, then, they would be safe from scammers. They could also regulate institutions that deal with the currency to avoid people losing their hard-earned money.
Conclusion
There are many more reasons for Italy to regulate the use of cryptocurrency, even as the European Union continues with its bureaucracy on cryptocurrency. It’s also important to note that because of the pandemic situation going on in the world right now, crypto regulation might not be as important. Despite this, Italy is considered among the most crypto-friendly European countries.