Crypto terminology can be confusing at best, and impossible to understand at worst. Cambridge Centre for Alternative Finance (CCAF) recently released a study which stated that the major problem for crypto and blockchain regulations today is the difficulty in understanding its terminology or more specifically the absence of a globally accepted crypto jargon.
A majority of crypto terms are misunderstood due to the lack of knowledge around them which leads to misplaced global regulatory policies.
The Focus of the Research into crypto terminology
The research was undertaken with the help of Nomura Research Institute (NRI) from November 2018 till February 2019 and included a complete examination of the global regulatory take on crypto assets and their activities. The study took into account a total of 23 jurisdictions.
Key Findings that the Study Highlights
The study highlights that “cryptoasset” in itself is a broader term and is not defined correctly. Generally, it is used to refer to digital tokens that are issued and transferred over blockchain systems.
Further, the study provided three possible definitions of crypto assets. Firstly, they took into account the above-mentioned general definition. Secondly, for dealing purposes, they defined it as any kind of digital assets openly accessible on a blockchain system without having to perform a function necessarily. Lastly, they defined crypto assets as digital tokens on a Distributed Ledger Technology that play an essential part in its functioning.
The Study’s Solution to the Crypto Regulatory Problem
The study also mentioned major difficulties faced by global regulators of the crypto industry and offered its solution. According to the report, jurisdictions should be able to understand the different terms of the crypto sphere and should also specify the terminology that is more suitable for their regulatory purposes before formulating laws. In this way, they will be in a better position to regulate the burgeoning cryptosphere that is set to take over the world.