One of the news stories today is that San Marino, which is a country around Italy, actually instituted some very clear government decrees on blockchain tech. They're a micronation that's positioning themselves in many ways to be a type of Luxembourg, Liechtenstein or Monaco, where people are setting up their crypto business structures, where they can at least say “Hey, I'm going to offer these offerings to EU citizens and the EU has a relationship with San Marino so at least investors will see that we're catering to them. So it's a good way of actually getting your foot in the door to access first world investment capital.
The legislation mainly deems crypto to be a token. A “utility token” is kind of how they're terming it. Because the way that they like to define it is that utility tokens are regarded as vouchers for the purchase of goods and services by the blockchain entity. And that's one way to position your crypto. They also say that security tokens are representing a debt instrument or an equity instrument. So there's kind of two camps that they fall into, and both are permitted. What we'll see in a lot of European countries is that transactions that are done with capital gains, and everything that is done outside of the country, will actually get tax favorable treatment, or we won't even be taxed on it at all, depending on your jurisdiction. So I hope to see similar types of technology legislation to explode into ubiquity. And Europe is a hotbed for all things crypto, and by this continuing the trend of favorable legislation in the crypto world, then it'll be a positive development for all the cryptos that are in the space. You always hear about North America having legislatures (and they have a presidential candidate now) that are in favor of crypto, but people are saying that there should be much more clarity regarding FCC regulations as to the legality of crypto.
When I attended my last crypto conference, the SEC’s narrative being discussed as their saying: “We want to protect people that aren't of substantial means from themselves by keeping them away from bad business opportunities. And one of the guys on a panel was like “Well, what about going to a casino, and putting it all on red? Or what about buying a lottery ticket?” Those are not great business decisions, you might say. A lot of times, they say the lottery tickets are a poor tax, because people that don't have a lot of resources go for gusto and they buy these lottery tickets, that have odds are one in the billion of hitting it rich. And they always say “You can't win if you don't play!”, but that's not a savvy way to invest.
So a lot of these crypto technologies would be helpful to all levels of economic strata that were afforded the opportunities to invest in. There are people that are building themselves up from the lower economic rung or have built themselves up by virtue of exclusively crypto. They have invested in projects that they found to be meaningful and have turned out to be substantially of great importance to the crypto world. So I’m not sure of the SEC rationale of keeping speculative investments off-limits, because crypto is speculative at the end of the day--no doubt, but just keeping them for accredited investors--investors that have a million USD or make in two out of the three last years over 200k per year--does a disservice to those that are looking to do better for themselves or their families. I've read that people that know the new SEC chief say that he's much more amenable to a crypto-positive or at least crypto-neutral type of thinking.
North America has a long way to go to catch up to Europe, but European technology legislation like this is a big step in the right direction to hopefully be mimicked all across the world. And hopefully it can be improved upon and adopted in many more countries that have a huge stake in crypto, of which just about all countries do these days, just based on the decentralized nature of crypto and people wanting to get access to something stable when their own currencies are wildly fluctuating or at inflationary rates so high that they're bound to go down.