The Norwegian financial regulator, Finanstilsynet, is search extensive legal and investor protection for citizens who invest or trade cryptocurrencies.

The requirement for this new hedge will be in the midst of extreme price volatility for Bitcoin (BTC) and other digital assets due to tighter regulation from China. Bitcoin lost its position at an all-time high of more than $ 64,000. Bitcoin traded for $ 32,915 during the day.

Finanstilsynet warns consumers of volatility that is damaging the ecosystem of a critical currency through price movements that are clearly at odds with traditional assets.

“Most cryptocurrencies are highly volatile. The risk of loss is high. An encryption currency normally has only one value in the system that established it, unlike traditional investment options that relate to, for example, commodities and stocks. In many cases, price formation is not transparent, ”says the Consumer Coordinator Jo Gjedrem said.

In addition to instability, Gjedrem also noted that cryptocurrencies are now used primarily for criminal activity. According to the regulator, online fraud “uses spam, computer viruses, fake drawings and many other techniques to deceive consumers”. All these risks, together with the difficulty of predicting value development, make it difficult for users to orientate themselves in the market, as the regulator pointed out.

According to Finanstilsynet, traditional markets also have inherent risks. However, proper registration and control in this niche can guarantee consumer protection, a luxury that is lacking in digital assets.

Talk of regulating cryptocurrencies is one of the most polarizing requests from proponents of encryption around the world. Although consumers accept the investment and supply of digital assets, regulators have had the disadvantage of providing a governance framework due to the nature of these cryptocurrencies. The EU is looking into this rolling extensive cryptographic regulation by 2024. In addition to wishes better provisions The United States is highly anticipated under the new president, Gary Gensler.

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