With crypto starting off as an unregulated industry, many changes have been made over the years from many groups and not just from government organizations. While the crypto space was once considered the "wild west" and has now moved towards the "progressive" era where those in the crypto community are working to making the crypto space a better and safer place for all. With that, comes regulations and economic changes.
The Wild West
Source: AllFreeMaterial
The crypto space was widely referred to as the wild west in the early days of its conception as there was a lack of regulations, security, and where people and crypto services fell victim to crimes such as theft and scams. Just like in the good ol' wild west where banks, trains, and people were robbed frequently and scams were all over.
The early days of crypto saw many exchanges hacked as the infamous Mt.Gox exchange was one of the first major exchanges to shut down after the theft of their Bitcoins. Since then, numerous exchanges have been hacked over the years of crypto. 2019 saw the highest amount of exchanges hacked than any other year according to a report.
Source: ZDNet
Individuals have gone through the struggles of losing their holdings due to hacks. Most were due to the lack of security on exchanges and wallets or hackers were able to gain access to accounts and wallets through various methods. Some as sophisticated as phishing scams that pose as a High-Yield Investment Programs (HYIP) or fake websites that lure crypto holders to signing up and giving their login credentials such as the email and passwords, eventually exit scamming and then using account credentials obtained to gain access to accounts on exchanges and other common sites or services people would use since there are many people that have the bad habit of using the same credentials for multiple sites or services.
Source: TechFoe
Scams have come in many forms in crypto and even one that was right in the face of everyone. There were many that were fooled by the Bitconnect Ponzi scheme and did not even want to believe what those that understood how those type of business models work were saying. There is still some today that will defend Bitconnect and support it and it's just been 2 years since the Ponzi crashed. Cloud mining, Decentralized Apps (DApps), Initial Coin Offerings (ICOs), and many other types of crypto scams have occurred over the years and still continue.
Ransomware and CPU mining malware is one of the more serious problems that the crypto space has encountered as they have a negative effect in numerous ways:
- Cripple crucial systems and data in our societies infrastructures
- Stealing computer resources without the owner's knowledge
- Slowing computer resources and performance causing less productivity
- Using more electrical resources
- Attackers profit at the expense of others
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The list can go on and on but in extreme cases, Ransomware could lead to death as it has been hitting hospitals with patient data is held hostage or even completely lost where knowing the types of procedures done or the types of medications that are being taken and given can the difference between life and death.
Ads at one point were even getting out of hand as countless ads were for scams and targeted users all over social media and the internet. That eventually led to Facebook banning crypto ads on their platform but eventually allowed it back after some time with new policy terms.
With all of these types of things going on and more in the crypto space, it was in many ways the wild west.
The Next Era of Crypto
Source: AmericanYawp
The wild west ended and moved on to the progressive era and during that time organizations formed and attempted to make businesses more responsible through regulations and growth of democracy began to propel. The next generation came into society and conformed to what was set up in the years before them. This is where the crypto space seems to be heading as it's being lead to a way on how to use crypto and do things in the ecosystem the way centralized organizations want us to do.
Regulations and Privacy
The latest regulations from taxes to businesses for crypto are making their way and lead to basically all crypto exchanges to follow the Anti-Money Laundering (AML) and Know-Your-Customer (KYC) policies across the globe. Which means no private transactions. While innovations in blockchain allow for private transactions to happen, it is currently being targeted as we see crypto exchanges and services follow the strict regulations with restrictions to using coin mixing services like CoinJoin or the Wasabi wallet. Users are receiving emails from exchanges of making withdrawals to these types of services that are not permitted and even some of them have their accounts suspended.
Mining
Source: UseTheBitcoin
Crypto mining seems to be an underlying target for organizations as we see more crypto apps being pulled from mobile app stores. Bitcoin Blast is a puzzle game that lets users redeem their loyalty points for Bitcoin. The app reported to have gained over 800,000 users, 13,000 written revies, and 20,000 ratings. The app was pulled from the Google Play Store for "deceptive practices" as the app was being updated with new taglines of “Earn Free Bitcoin!”, “Cash Out Free Bitcoin!". The problem doesn't seem to be towards mining however, Google has been banning crypto-mining apps from the Play Store since back in 2018 and previous reports of MetaMask being "mistakenly" removed from the Play Store for mining cryptocurrency when they were not. MetaMask has since been reinstated to the Play Store. Apple has also banned crypto-mining apps from their products.
Crypto mining has been an issue in part to the sustainability of a blockchain as many coins that were launched early and even til now need mining to run the network and keep it secure by verifying transactions. In order to do that, mining requires using computer hardware and the amount of power the hardware consumes can be quite a lot when looking from the perspective of a global collective of miners. This could lead to an overload of power consumption to grids as we still currently experience today and looking for alternative methods for energy.
The current energy consumption of just the Bitcoin network at the time of writing this:
One serious part where Bitcoin and other crypto are concerning with their energy consumption is when compared to countries and to payment services that crypto is competing with.
More full details can be found at Digiconomist.
Minning has evolved with crypto in different ways. Ranging from the algorithm to mine more efficiently on lesser performing hardware to completely removing the Proof-of-Work (PoW) consensus of mining and move towards other methods such as Proof-of-Stake (PoS), which still does use computer resources and it is still required for nodes to produce blocks and verify transactions on the network to keep it secure.
Content/Ads
With the crypto industry still being young, there are many ways to promote cryptocurrencies such as videos and ads. But like mentioned earlier about Facebook banning ads, Google was also doing the same recently when there were the YouTube bans and was said it was due to an "error" and reinstated the majority of the legitimate content on its platform. It is reported to be happening again in 2020 as users are receiving strikes for violating YouTube's guidelines.
The initial start to all these bans was to put a stop to all these crypto scams with fake crypto ICOs that was flooding the YouTube platform. At the same time, many of the promoting content was for mining scams and mining in general, which once again mining is a sustainability issue that affects Google and many other cloud hosting platforms with the use of their physical servers being used for mining which is not permitted. Preventing apps and developers from using their Virtual Private Server (VPS) services from creating or doing anything dealing with mining. In the past few years, cloud hosting services like Amazon and Google have launched more support that is focused on cloud services for blockchain applications.
Tech companies have already begun making their changes to dictate how the crypto space should be or how it can be by creating the policies that allow crypto users that use their services are only allowed to do things a certain way. Otherwise, apps and services may be terminated.
Source: Pixabay
New users continue to enter the crypto space and they and everyone else in crypto is being conformed to follow AML/KYC regulations along with other policies that services create. This in many ways can lead to the culture of the "how things are done" in the crypto space as there is a split among the community with many that believe in privacy as everyone should. While conforming to this new way may help better and keep the crypto space safe from some perspectives, most in the crypto space don't consider it a good long term system as most end up sacrificing their freedom and privacy for convenience and security.
The fight for privacy and freedom continues.
