Vitalik Buterin Discusses Cryptocurrency Regulation

Before beginning to receive the attention it merits, the crypto industry, in Vitalik's opinion, still has to expand and mature. He also discussed the laws that affect how a crypto ecosystem functions from the inside out.

“Basically, there are two main classes of regulatory policy goals: (i) consumer protection, (ii) making it harder for baddies to move large amounts of money around. The issues around (ii) are concentrated not in DeFi, but in large-scale crypto payments in general,” Vitalik stated.

According to his shared beliefs, the Ethereum founder considers regulation that grants internal independence to cryptocurrency projects to be significantly less destructive than that which interferes with the internal workings of cryptocurrency.

Also noted by Vitalik was how irrelevant the concept of KYC (know-your-customer) on DeFi (decentralized finance) frontends appeared. He claims,

“it would annoy users but do nothing against hackers. Hackers write custom code to interact with contracts already.”

Vitalik went on to say that one of the concepts that is far more logical is KYC on exchanges, which is already happening today. In response to this, he made three suggestions that might be applicable to rules governing DeFi frontends.

Limits on leverage, disclosure of the audits, FV, or other security checks performed on contract code, and experience and understanding tests as opposed to plutocratic gross minimum rules are among the suggestions.

In order to satisfy legal requirements and protect user privacy, Vitalik advocated zero-knowledge proofs, saying, “I would love to see rules designed in such a way that requirements may be achieved by zero-knowledge proofs as much as possible.”

On Friday, Matter Labs announced the availability of ZkSync 2.0, a scaling solution for Ethereum that would allow programmers to host smart contracts, install DeFi protocols, NFTs, and other kinds of services on the Ethereum network.

As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!

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