The new age of technology and development brought with it many unconventional methods of performing tasks that were otherwise done serially, without many alternatives to look at before choosing one. Observing the trends of this autonomously altering history, it can be easily driven what stirred the change in different aspects of human life and these factors can all be tracked back to two fundamental attributes of the human body; curiosity and the need to ease day-to-day tasks. Looking at it objectively, a similar trend could very effortlessly be found in all of the major inventions and in most of the advancements in fields of sciences and technology. Starting from the invention of the wheel and initial hunting equipment down to the theory of relativity and the mystery behind the formation of black holes, everything can either be linked to the primal human curiosity or the need of human to ease the tasks one has to perform day in and day out.
Thorough analysis of history reveals that currency as we know it today is more than 14 centuries old. With all the advancements of sciences and technology and humans on the whole taking massive strides towards achieving more than ever before, to date, the most widely accepted and used method of value transfer and possession is paper currency, which in truth dates back to a time from which age the other concepts have long been wiped out. The reason is plain and simple; paper currency has by far been the most secure and reliable form of keeping value in check. However, it was only primal of people across the globe wondering on the fact that why are we still using a concept that should be taught in history books.
With the coining of the term cryptography for the first time in the late 1900s, the world of technology first envisioned the subsequent creation of electronic methods to store and transfer values, and hence the possibility of “digital currency” somewhere down the future. Without, delving deep into what cryptocurrency is, in layman terms, it is a digital security which is designed to be a medium of value interchange and is essentially a kind of alternative form of currency and digital currency. With its domain creation in 2008 and the subsequent mining of its first block in 2009, Bitcoin became the first cryptocurrency to ever pose a threat to the existing banking system with its strong foundations of BlockChain and cryptography. Rising to an all-time highest worth of $19,666 in December 2017, Bitcoin turned out to be very real and would have actually replaced the currency as we know it today, had it not been for some fatal flaws appearing in its system.
Along with the massive price fluctuations in the first half of 2018, two other primary flaws were gauged. The first flaw was the security concerns; within the first half of 2018, $761 million worth of cryptocurrencies were reported to have been hacked and stolen. Although the theft was allegedly conducted by altcoins (other alternative cryptocurrencies launched after the success of Bitcoin), the vulnerability of Bitcoins was revealed hence investors’ trust in the cryptocurrency lifted eventually. The second setback came in September 2018 when the Securities and Exchange Commission filed charges against a Bitcoin-funded securities dealer and CEO.
A company registered in the Republic of the Marshall Islands, 1pool Ltd. a.k.a 1Broker asked investors from both the United States and around the world to trade security-based swaps. However, with just the provision of an email address and username, potential investors had the freedom to open their respective accounts. This allegation was confirmed by the SEC when they employed the services of a Special Agent of the FBI, who using the aid of an undercover capacity, successfully brought multiple security-based swaps from the portal of the alleged international securities dealer, without the fulfilment of the criteria set by the federal securities laws. The SEC also blames the dealer that they failed to transact the swaps on a RNE and additionally failed to completely register as a security-based swaps dealer. In a press release by the SEC, the statement was made that irrespective of the type of currency used for transactions, it is their duty to protect U.S. investors across a multitude of platforms and that companies that operate with the U.S. investors using cryptocurrency will fail to comply with the federal securities law. The filed complaint seeks everlasting ban, disgorgement plus interest and further financial punishments.