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Speaker 1: Welcome to Ask Fear and Greed, where we take your

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Speaker 1: questions and do our very best to answer them. I'm

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Speaker 1: Michael Thompson and hello Sean Aylmer.

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Speaker 2: Hello Michael.

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Speaker 1: Sean. Today's question it's an absolute ripperp So Tammy has

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Speaker 1: written to us and she's gone to Fearangreed dot com,

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Speaker 1: dot at you and centerce an email via the website.

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Speaker 1: You can do it my social media as well if

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Speaker 1: you want. But Tammy has gone to the website and

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Speaker 1: she says, Hi, Fear and Greed, May I ask when

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Speaker 1: or how did crypto form part of the value of

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Speaker 1: the stock exchange. I loved it. The wariness already creeping

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Speaker 1: into your boys. She then goes on to say, I'm

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Speaker 1: curious as to how this asset has been able to

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Speaker 1: become part of a highly regulated market without the regulations

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Speaker 1: being in general terms applied to crypto under AML and

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Speaker 1: banking codes, et cetera. Has the creation of ETFs exchange

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Speaker 1: created funds meant the introduction of crypto to the regulated

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Speaker 1: share market.

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Speaker 2: Yes, essentially, because what regulators are doing is relying on

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Speaker 2: the provider of ETFs to effectively put the rules around cryptos.

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Speaker 2: So crypto regulation around the world is a mishmash somewhere

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Speaker 2: between technicality is it is somewhere between detailed rules designed

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Speaker 2: to support blockchain technology to outright bands and so depending

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Speaker 2: where you are in the world, regulations are incredibly all

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Speaker 2: over the place. I mean the US leads away. Different

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Speaker 2: federal agencies treat digital assets differently based on what they think.

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Speaker 2: The big one really is the Security as an Exchange Commission.

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Speaker 2: It wants to classify digital assets as securities. That hasn't

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Speaker 2: quite got there yet. What they did in January last

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Speaker 2: year they approved bitcoin and theorem exchange traded funds. Then

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Speaker 2: others followed. It kind of gave a form of legitimacy

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Speaker 2: to cryptos, but it wasn't regulating in sense it was

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Speaker 2: putting the responsibility for the regulation on the providers of

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Speaker 2: the ets right, rather than actually regulating them themselves. Okay,

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Speaker 2: now the UK regulated well, it regulates digital asset companies,

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Speaker 2: but doesn't really make rules for cryptos. L Salvador was

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Speaker 2: famous because the Central American nation stood out for being

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Speaker 2: the only country to declare bitcoin as legal tender. So

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Speaker 2: that's the other end of the spectrum. What about here,

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Speaker 2: So we've begun the process of developing a regulatory framework

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Speaker 2: for cryptos and blockchain technology. Terry was talking about AML,

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Speaker 2: which is anti money laundering, so we kind of have

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Speaker 2: so OSTRAK for example, it looks at anti money laundering, CANA, terrorism,

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Speaker 2: and financing, and cryptos are captured by those rules. The

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Speaker 2: Tax Office captures cryptos, ASCIC considers it a crypto a

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Speaker 2: financial product, so by default some of the agencies do

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Speaker 2: capture or impose regulations on cryptos. But she's right, there

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Speaker 2: is no over arching rules for cryptos, so you can

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Speaker 2: certainly buy ETFs that invest in cryptos on the AX

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Speaker 2: And so I think her point is one hundred percent right.

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Speaker 2: I mean, has a creation of ETFs and meant the

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Speaker 2: introduction of crypto to the regulated share market. Yes, but

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Speaker 2: the regulators have done a really poor job of getting

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Speaker 2: their head around it, and they've basically put the onus

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Speaker 2: of regulation on the companies providing the ETFs.

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Speaker 1: That's a fascinating one, isn't it.

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Speaker 2: Yeah, it is.

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Speaker 1: I haven't got it right, Tommy. I hope you're satisfied

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Speaker 1: with that answer.

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Speaker 2: She also went on to say, my sinister view is

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Speaker 2: the black market has become part of the market, and

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Speaker 2: you know, I mean her point. I mean that she

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Speaker 2: says a bit more, which sort of turns that down.

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Speaker 2: I've given the heart part, but it is a fair point.

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Speaker 2: When you've got assets that are in the market that

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Speaker 2: aren't really fully regulated, that is a black market kind

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Speaker 2: of by definition, And we think of the black market

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Speaker 2: as criminals, and we're not actually necessarily talking about criminals here.

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Speaker 2: We're just talking about assets that are outside the regulated market.

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Speaker 2: And so in a way it's sort of they have

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Speaker 2: shifted into markets and the regulators have done a bad

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Speaker 2: job of getting your head around it. Of course, with

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Speaker 2: Donald Trump, the SEC will have to put some sort

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Speaker 2: of parameters around it. I think regulations might be an

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Speaker 2: over strong, like maybe too strong a word, some loose guidelines,

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Speaker 2: guidelines or something like that. And he wants it to

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Speaker 2: have a digital currency kind of was it the Fort Knox.

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Speaker 1: Fort Knocks of digital currency, which is a great image.

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Speaker 2: It is a great image, so that gives them more legitimacy,

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Speaker 2: but they're not very well regulated, but they're increasingly legitimate.

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Speaker 1: Okay, all right, Tammy, I hope that's done. The trick

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Speaker 1: I reckon so too be a good discussion. We can

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Speaker 1: always do part two and I can watch the color

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Speaker 1: drain from Sean's face all over again.

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Speaker 2: Regulation is hard.

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Speaker 1: Oh it's great, isn't it. Thank you very much, tame

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Speaker 1: me for the question. Thank you Sean for having a

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Speaker 1: crack out of it.

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Speaker 2: Thank you, Michael.

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Speaker 1: Remember, if you've got something that you'd like to know,

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Speaker 1: then send through your question at Fear and Greed dot

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Speaker 1: com dot au or go to LinkedIn, Instagram, Facebook, anywhere.

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Speaker 1: Really get it to us and we'll put it on

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Speaker 1: the list. I'm Michael Thompson and this is ask Fear

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Speaker 1: and Great