The large number of altcoins that crashed in 2022 as a result of the pervasive bear market that dominated the crypto space has attracted the attention of different countries’ regulators on the need to monitor the activities of the altcoins. Countries such as the UK and Canada have pushed bills to grant their financial regulators more powers to monitor the altcoins. Other countries too are in the process of formulating new laws to guide the creation of new altcoins today. Can the altcoins survive this massive probing coming from the regulators in 2023? Is it still safe to buy dogecoin now as well as other popular altcoins? This work has examined these important questions.
Meaning of Altcoins
The term altcoins is a general name used to refer to every other cryptocurrency excluding Bitcoin. This concept is used to create a distinction between Bitcoin as the first and most valuable Cryptocurrency from other cryptocurrencies created after Bitcoin. Another important reason why other cryptocurrencies outside Bitcoin have been classified as altcoins is based on the fact that they were created out of Bitcoin’s Blockchain. With the rising number of projects now established on the Ethereum blockchain, many experts now prefer to exclude Ethereum from the list of altcoins and to classify it alongside Bitcoin as the two most important Cryptocurrencies that birthed the altcoins.
Regulators out to fight altcoins in 2023
The bear season often served as a good moment for testing the weak and strong crypto projects. The large number of altcoins that crashed in 2022 especially the TerraUSD, Luna, FTT, etc, have attracted the attention of the financial regulatory authorities to monitor who creates a crypto project and how the created altcoins are distributed over time; to ensure that only the strong projects are created.
The UK Treasury, for instance, had passed a bill earlier in 2022 designed to give the FCA more powers to monitor the activities of the altcoins and every other cryptocurrency sold within the country. Canada on its part has passed a bill to ban all the crypto exchanges in the country from listing stablecoins on their platforms. The US too, is working on giving more powers to the SEC to regulate all the transactions involving Bitcoin and altcoins within the US today. Other countries such as India, Singapore, France, etc, are also working on tightening the regulations for all crypto transactions within the country.
The major fear for investors at this point is if the altcoins will survive these double-edged swords targeted at them today. We have examined this concern in the next paragraph below.
Will altcoins survive the Regulators’ double-edged Sword in 2023?
The fact that Cryptocurrencies have been established on a decentralized Blockchain have always given them an edge to survive the various efforts at total elimination by the different regulatory bodies across the globe. While the regulators might succeed in regulating the altcoins traded at the Centralized crypto exchanges within the country, it remains difficult to regulate those traded through the decentralized crypto exchanges. This makes it increasingly difficult for regulators to stop new crypto projects and altcoins from coming into existence as well as totally obliterating the existing altcoins today.
Is it safe to invest in altcoins in 2023?
Altcoins investments have become the second second-class investments after Bitcoin. However, the strong potentials found in many altcoins, especially those having lower prices than Bitcoin, have attracted large investors into them. With many altcoins projects crashing today, it becomes very necessary for investors to make proper research before investing in any altcoin project today.