Lithuania crypto regulation
Function of Lithuania crypto regulation
Since cryptocurrencies are currently widely utilized and growing quickly, the term “capitalization” — which refers to the total value of all coins in circulation — has been used to describe the market’s overall status. Instead of a central bank, as is the situation with fiat money, a community of users employing collectively created cryptographic protocols performs the regulatory function for cryptocurrencies. Anyone may utilize this decentralized technology without restriction because the source code is frequently open. Cryptocurrency exchanges ought to be subject to the same regulations as traditional ones. Exchange services must to be licensed and recognized as financial service providers.
The importance of Lithuania crypto regulation
Market manipulation is an issue in the bitcoin market, just like it is in the traditional securities market. In general, it refers to the purposeful establishment of a false pricing for a good, asset, or form of money. Due to manipulation, unregulated cryptocurrency exchanges that link fiat cash and cryptocurrencies cause investors to lose money. Unlike conventional stock or commodities exchanges, certain cryptocurrency exchanges may not follow user identification rules because they are registered in separate countries in many circumstances. Even without a formal legal body, they can function. These international exchanges enable money-laundering schemes and unrestricted cross-border money transfers in the absence of regulatory scrutiny.