Keep Innovation in America Act
The Keep Innovation in America Act has just been introduced in November 18, 2021 by a bipartisan group of US lawmakers to amend crypto taxation in the Infrastructure Bill signed by President Biden just a few days before. The goal of the act is to create regulation that “does not stifle entrepreneurship, innovation, or impede privacy rights.” The act will properly define “broker” and “digital asset” and the information that a “broker” can gather from a crypto user.
House Representative Tim Ryan says, “We have to figure out how to balance consumer protection and reasonable oversight while simultaneously providing these technologies and companies with the necessary space they need to grow, innovate and democratize the financial sector.” The act is supported by organizations within the crypto industry such as Coin Center, the Blockchain Association, the Crypto Council for Innovation, and the Electronic Frontier Foundation.
This is good news for the crypto community although it would take some time before it’s finalized as an amendment to the Infrastructure Bill. It is refreshing to know that the US government is beginning to understand that cryptocurrency is here to stay and they are taking steps to be a part of the emerging technology while recognizing privacy.
Kraken Delists Monero in the UK
Meanwhile in the UK, Kraken, the eighth largest crypto exchange, has delisted Monero from their offerings in compliance with regulations in the United Kingdom. Bittrex delisted Monero in 2020 while Coinbase declined to list privacy coins.
Over the years, privacy coins and Monero in particular, have gained notoriety for being the cryptocurrency of choice for cyber-crime, drug trafficking, tax evasion, money laundering operations, and white supremacists. However, it cannot be generalized that all Monero users are involved in criminal activities. Grayscale VP Craig Salm told CoinDesk’s Colin Harper at the Consensus 2021 conference, “There’s sort of been this insinuation that because you’re using digital currency that has additional privacy-preserving features that it’s inherently bad or you’re using it for improper reasons and that's not true." CoinDesk says that according to analyses, “A much lower proportion of cryptocurrency transactions are tied to criminal activity than is seen with US dollar transactions.” Many legitimate businesses and average Joes who value privacy favor crypto coins that will not expose their price sheets or wallets over the blockchain for business competitors or everyone else to see.
The Future of Privacy Coins
For now, restrictions are on a limited scale. There are centralized exchanges that still offer privacy coins in their platform. There is also the option of using decentralized exchanges or via peer-to-peer. At the Consensus 2021 conference, Solidus Labs COO Chen Arad maintains that regulators and the crypto industry can actually work together without having to sacrifice users’ privacy. What regulators will need is not access to personal and financial information, but rather technology such as advanced data analytics and machine learning to be able to connect dots.
For crypto investors, the latest news relating to crypto users’ privacy seem to have little effect on privacy coins. Their total market cap has exceeded $15 billion. Monero has grown 109% in value in 2020 and reached an all-time high in daily transactions on November 10, 2021. Wallet Investor predicts that Monero’s price may rise to $332 by the end of 2021 and $483 by the end of 2022. Digital Coin forecasts an almost similar rise in value.
Just like any investment, you will do well to do your own research and analysis before deciding to buy or sell any crypto. Don’t invest what you cannot afford to lose. Make online safety a priority before making any transactions. Put majority of your digital assets in a wallet. Make sure you safekeep your Monero coins by putting them in XMRWallet, a secure and free web-based wallet that gives you full control of your XMR and keys. Always keep all your passwords, private keys, and seed phrases to yourself.