Recent proceedings in the blockchain market have thrust the realm of regulation into stark relief. A peculiar case involves the Terraform Labs’ co-founders, Do Kwon and Daniel Shin, whose 2019 Slack conversations have sparked the intrigue of none other than the United States Securities and Exchange Commission (SEC).
The dialogues between Kwon and Shin hinted at an audacious proposal to manufacture deceptive transactions on the Terra blockchain with the intention of attracting investors. As the notion came to light, Kwon asserted that the unearthing of this information was out of context. The intention, he claimed, was to discuss the possibility of staking LUNA tokens with validators and promoting transactions between LUNA wallets.
Meanwhile, Kwon’s legal representatives are fervently opposing the SEC’s extradition request to the US over the disintegration of the Terra ecosystem. Given Kwon’s ongoing detention in Montenegro due to passport fraud issues, his lawyers have deemed the SEC’s extradition request as unfeasible.
On another front, Gemini, the cryptocurrency exchange, is expanding its presence in India via a $24 million investment in its development center. This is indeed an interesting move, given India’s turbulent relationship with cryptocurrencies. Recognizing India’s startup-friendly environment, Gemini continues to bank on India’s potential despite its regulatory ambivalence.
Cryptocurrency exchanges continue to adapt and improvise in the face of tightening regulation. Kraken is now reportedly stepping into the domain of securities trading in the US and the UK. Consequently, Kraken’s expansion calls for licensing authorities’ approval, especially FINRA and other UK financial regulators.
While regulatory oversight has always been present in the finance industry, its role and scope with regards to cryptocurrency are evolving continuously. The key lies in creating a balance, providing enough leeway for innovation to thrive, but at the same time keeping scams and other illicit activities at bay. While stories like Kwon’s elude clear classification into right or wrong, they most certainly cast a shadow of skepticism over the blockchain industry’s practices, scrutinizing norms and triggering pivotal conversations about the necessity of effective governance.
Source: Cointelegraph
