Cardano and regulation

The traditional financial world is highly regulated and controlled by many authorities. KYC/AML is the standard without which no financial intermediary can offer its services. Everything is governed by decades-old laws. Occasionally, a new one comes along. No one is too concerned about whether the current state of affairs suits us and whether the laws should be fundamentally changed. Cardano will be a global financial and social operating system. Blockchain technology was created on principles that do not comply with current laws. Cardano has no built-in support for KYC/AML. Anyone is free to run any financial service. Users can use these services without providing private information or asking for permission. As the adoption of cryptocurrencies grows, it will strengthen the position of the alternative world against the traditional highly regulated financial world. Moreover, this alternative is based on completely different principles and rules. How should the Cardano community approach efforts to regulate cryptocurrencies? We should insist that the authorities do not restrict the functioning of the first layer and DeFi.

TLDR:

  • Cardano is a global network. There is no mailing address to send a request for transaction censorship.
  • Technologically, it is not possible to freeze a blockchain account.
  • If it were criminal to send an on-chain transaction, people simply won’t do it. Cardano would not be an alternative financial world, but an enemy of the state.
  • We believe that the same rules that apply to the Internet today can also apply to blockchain technology.
  • If we were to very vaguely define a boundary that would be untouchable by regulators, it would be source code development and the use of decentralized applications.
  • If regulators try to restrict technology just to prevent something bad from happening, what will unfortunately happen is that they will also prevent the good from happening.
  • It is possible to regulate CeFi because people make decisions in this industry. Users have to trust a third party, similar to TradFi.
  • Decentralisation is about change at the level of trust. Instead of trusting intermediaries and the entire legal system, the source code and principles of decentralisation can be trusted.
  • Due to the nature of decentralization, it is not possible to require all developers to comply with regulations globally. Regulation is not enforceable and can be easily circumvented.
  • Inappropriate regulation can destroy all the benefits of decentralisation and prevent us from building a potentially better financial world.

This article was prepared by Cardanians with support from Cexplorer.

Read the article: Cardano and regulation | Cardano Explorer

1 Like

That is a fantastic “elevator pitch”.