A lot has happened in the world of Bitcoin this week. The Chair of the Federal Reserve recently gave the opinion that the Fed does not have the authority to regulate Bitcoin because the technology is not tied to the financial institutions under its jurisdiction. While the Fed may not have jurisdiction over this new platform, if Bitcoin is to serve a long-term proposition, it is necessary to establish a regulatory framework in order to protect stakeholders. Hopefully the loss of about half a billion dollars from Mt. Gox will inspire some global action. While many in the Bitcoin industry (if we can call it that, yet) have assured the community that they believe in “transparent, thoughtful, and comprehensive consumer protection measures,” we have learned throughout our world history that financial services companies (particularly those operating on a global scale) are not able to sufficiently self-regulate.
The reality is that this is a huge opportunity for those in the Bitcoin space rather than an impediment. If the goal is to push Bitcoin mainstream, then it is necessary for the platform to get legitimate recognition from the major global economic drivers. This means enacting certain consumer protections that are not present in the system today. This is a rapidly evolving space that leaders like the Bitcoin Foundation can play a significant role in.
What are your thoughts on the future of Bitcoin? Tweet at me with #bitcoin, and let me know!