Global Control of Crypto and Regulatory Arbitrage

Course Description: Digital assets represent value stored in electronic form and one of the main types of digital asset are cryptocurrencies. Cryptocurrencies facilitate the exchange of value between people, electronically, and come in many different forms, such as security, payment, utility, and stablecoins. They have the potential to disrupt markets and also be manipulated. That is why states across the world are seeking to control them. Whilst we have seen a common approach to control, the speed has not been the same. States have sought to regulate exchanges, proscribe financial crimes, require stringent cyber security controls, and delineated the different types of cryptocurrencies. However, not all states have done this in the same way. This could lead to regulatory arbitrage and associated risks. Learning Objectives: 1. Describe the meaning of regulatory arbitrage 2. Compare the different ways in which states have sought to control cryptocurrencies 3. Give examples of how this is likely to lead to regulatory arbitrage 4. Summarise associated risks and what can be done to mitigate them