The U.K. Government is considering banning the use of the terms “bitcoin”bitcoin trading”. This would affect those who are involved in the financial industry, but it could also have implications for traders on the whole. Here we look at the main three reasons why the proposed ban could really impact the future of the FX markets.
First of all, the reason the U.K. government has come up with this new policy is to try and stop the use of words like “FX”. It’s not clear whether this means that they will ban the words themselves, or if they will introduce a new law to do so. However, it is a strong indication that the government thinks there are too many people using the words “FX”bit coin” to describe an industry. There is no legal definition for the terms, and therefore there is no clear distinction between these two types of trading.
Second, the U.K. government is concerned that the term “bit coin” is a way for traders to avoid regulation. At the moment, all banks, credit unions, and other institutions trade in dollars. However, some traders like to buy and sell their currency using either coins or pieces of jewellery that are known as “bit coins”.
Thirdly, the U.K. government has argued that there is a chance that the market for “bitcoins” will collapse in the future. However, it’s a little unclear what is meant by this. In the same way that there are plenty of people trading shares in shares that are not registered under that particular share scheme, there are plenty of people trading in pieces of jewellery that aren’t registered under the terms of the U.K. share market.
From a technical point of view, I can’t see the risk of any form of currency trading being taken seriously enough at the moment to warrant this kind of long term stability. So there is a good chance that the government is making this announcement because they are trying to keep their options open and to allow more people to enter the market, and as such the price volatility could increase if there is a big surge in volume over the next few months or even years. The U.K. is a highly volatile place in many ways, and any kind of instability might not be welcomed by the market.