With a track record going back over a decade, cryptocurrencies are clearly more than just a fad, but they remain widely misunderstood by many people, with doubts persisting about their genuine value, practical use and long-term application.
There is also considerable concern with regards to their volatile nature and potential for exploitation. According to data from Scamwatch, Australians lost $158 million to investment scams between January and May of this year, the majority of which related to cryptocurrency ‘investments’. Such revelations have prompted Australian Treasurer Jim Chalmers to recently announce plans to offer greater protection for consumers.
“Australians are experiencing a digital revolution across all sectors of the economy, but regulation is struggling to keep pace and adapt with the crypto asset sector,” Mr Chalmers said in a statement.
The ATO estimates that more than one million taxpayers have “interacted” with the cryptocurrencies since 2018.
In the truest sense, cryptocurrencies are a digital means of exchange which use cryptography as a form of security. However, in recent times, the term ‘cryptocurrency’ has evolved as a stand-in description for, more broadly, a decentralized financial system (DeFi), a highly volatile asset class that can nose-dive or surge on the back of a Tweet, a space for bad actors to steal vulnerable investors’ identities and money, and a form of digital payment.
Mainstream investors, as well as Australia’s financial institutions, are also taking more than a passing interest in cryptocurrencies.
The Commonwealth Bank is trialling crypto trading through its banking app, ANZ recently minted $30 million of Australian stablecoins called A$DC, and National Australia Bank (NAB) is also expected to release its own stablecoin (linked to fiat currency, the Australian dollar) by the end of 2022. However, concern over the safety of cryptocurrencies as an investment class remains front and center in the minds of financial regulators around the world.
Continue reading: https://www.forbes.com/advisor/au/investing/cryptocurrency/what-is-cryptocurrency/
There is also considerable concern with regards to their volatile nature and potential for exploitation. According to data from Scamwatch, Australians lost $158 million to investment scams between January and May of this year, the majority of which related to cryptocurrency ‘investments’. Such revelations have prompted Australian Treasurer Jim Chalmers to recently announce plans to offer greater protection for consumers.
“Australians are experiencing a digital revolution across all sectors of the economy, but regulation is struggling to keep pace and adapt with the crypto asset sector,” Mr Chalmers said in a statement.
The ATO estimates that more than one million taxpayers have “interacted” with the cryptocurrencies since 2018.
In the truest sense, cryptocurrencies are a digital means of exchange which use cryptography as a form of security. However, in recent times, the term ‘cryptocurrency’ has evolved as a stand-in description for, more broadly, a decentralized financial system (DeFi), a highly volatile asset class that can nose-dive or surge on the back of a Tweet, a space for bad actors to steal vulnerable investors’ identities and money, and a form of digital payment.
Mainstream investors, as well as Australia’s financial institutions, are also taking more than a passing interest in cryptocurrencies.
The Commonwealth Bank is trialling crypto trading through its banking app, ANZ recently minted $30 million of Australian stablecoins called A$DC, and National Australia Bank (NAB) is also expected to release its own stablecoin (linked to fiat currency, the Australian dollar) by the end of 2022. However, concern over the safety of cryptocurrencies as an investment class remains front and center in the minds of financial regulators around the world.
Continue reading: https://www.forbes.com/advisor/au/investing/cryptocurrency/what-is-cryptocurrency/
