Crypto exchanges Bitstamp, Gemini, Bitflyer USA and Bittrex have teamed-up to create a self-regulatory organisation for digital assets.
According to a post on Medium by Cameron Winklevoss on August 20th 2018, co-founder of Gemini, joining the Virtual Commodity Association (VCA) is a step towards “thoughtful regulation” for an industry in need. The 4 major exchanges formed this new group; Virtual Commodity Association Working Group in order to ensure safety for investors to widely adopt cryptocurrencies. The association aims to offer self-regulation on digital commodities that include cryptocurrencies, amongst others in future.
Though cryptocurrency has been a manic and rather ‘jungle’ ruled market, the group believe the move will regulate expected standards for investors.
The newly created organisation hopes to hold its first meeting in September this year (2018). The group is quick to explain the kind of problems that it hopes to solve:
In equities, securities exchanges have their own organization to come up with common standards and jointly respond to declarations by regulators. The new group could serve as the equivalent for the crypto world by coming up with best practices for the industry, looking at ways to boost liquidity, and stamping out market manipulation.
Of course, these are comments crypto-advocates have been wanting to hear for some time. Interestingly, Coinbase, one of the largest exchanges in the U.S. is not part of this association, and according to the business insider, they have refused to comment on the development. An odd situation not to comment on, given the current collaborations happening across the industry since the start of the 2018.
The move leaves many wondering whether the VCA will be able to combat local governments lack of adoption, or have to conform to standards they’d otherwise in place to prevent, such as centralisation. We hope they can become a trusted source for governments and that a healthy relationship can be developed.
The uncertainly comes from the recent events by Korean Exchanges that promised to stop adding new tokens and instead start adhering to the real-name guidelines of the government – though this was arguably a safe move for everyone and only puts new, unverified blockchain companies through the correct measures. Unfortunately, in the majority of cases they did not stick to this course of action. So whether the VCA will stick to its core mandate or not, remains to be seen.