Years after the creation of the first cryptocurrency, the industry is slowly shifting. Bitcoin shaped the cryptocurrency industry, helping it to become a very organized ecosystem. The cryptocurrency is changing the global financial industry, shaping a new financial era.
The Government Surveillance Problem
After years of complex political dialog, the European Union has also changed privacy. The General Dara Protection Regulation came at a time when a change was needed. Privacy regulations on a government level were almost non existent. Since its wide adoption a couple years ago, we can analyze its effects on economies and crypto. We can also see how th cryptocurrency law making process was affected by the new data protection act.
From one perspective, cryptocurrency has fueled dark-net enable crime. The rise in criminal activity using cryptocurrency fueled the need for surveillance. There is a need for state-controlled mechanisms to reduce crypto fueled crime.
This criminal activity fueled by cryptocurrencies also affects real stakeholders. The transparency of some blockchains has enabled them to track cryptocurrency applications. The governments need to understand origins and destinations of transactions has enabled partnerships. Blockchain analytics firms are working with governments to reduce crypto enabled crime.
One example of such partnerships involves the U.S. Federal Bureau of Investigation. The FBI contacted blockchain intelligence firms to assist with tracking cryptocurrency transactions. This partnership is targeting the twitter scam perpetrators.
Moving apart from the twitter example, other partnerships also exist. The government partnerships signify the present and the future of government surveillance. Cryptocurrency surveillance is one of the largest government targets. Being able to track cryptocurrencies enables the government to target countless crimes.
The unstoppable wide adoption of digital currencies only fuels the need for surveillance. We are living in an era of vast user generated transaction data. Stakeholders are planing to succeed at analyzing the wide range of information.
At the same time, exponential advancements in blockchain surveillance are consistently being made. That coupled with mass analysis of blockchain data will only make it easier to track people. Tracking methods are getting more advanced. The government will not have to gather as much information in order to track criminals.
The mass data will be at the governments fingerprints. This wealth of blockchain data is great new for the government. But despite all this, some people are raising a few questions related to privacy. Will the GDPR or other privacy regulations have an effect on the government? Most probably not. The government is likely to consider surveillance more important than privacy. This will be due to all the crime tackles thanks to the surveillance in this field.
Privacy Regulations and its Benefits
The common though among crypto enthusiasts is that government wants to hold back crypto-growth. This might be partially true but there is no evidence to back it up. Regulations can effect blockchain progression but not only in bad ways. Most people seem to decry the excessive government interference in the cryptocurrency field.
Some of the concerns might be valid, but not all. In most cases regulations help cryptocurrency adoption. By regulating the space, businesses will feel more comfortable adopting cryptocurrency support. Just like traditional fiat currencies, cryptocurrencies require a proper legal framework to function.
Some privacy laws will server as a protective layer for crypto users and regulation agencies. Common grounds for cryptocurrency surveillance will be established. These laws will serve to prevent bad surveillance practices.
Some people find it hard to believe, but GDPR created massive changes. Many companies and government agencies were ignorant when it comes to privacy. This no longer stands true as a proper privacy framework was established. Although the GDPR only servers Europe, it affected most of the world. Most organizations adapted and made changes internationally. From a corporations perspective this makes a lot of sense. It would be more complicated to establish multiple policies for different regions.
Regulators and Cryptocurrency users mostly share the same goals. Both parties want to ensure that cryptocurrencies are used for noble reasons. This is exactly what most cryptocurrency developers envisioned. Achieving this will unleash the full potential of cryptocurrencies.