Navigate Crypto Regulatory Waters in 2022 with BITQ

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This year has seen tremendous growth for crypto assets, and next year is expected to continue to see forward momentum in the space.

However, along with giant strides this year, regulatory pressure has increased, with China banning crypto activity entirely and the United States also starting to ease regulations. These regulatory pressures are also expected to continue to weigh on crypto next year, as well, and experts have discussed with CNBC which areas they see regulation targeting the most in 2022.

“2022 will undoubtedly be a big year from a regulatory perspective,” said Vijay Ayyar, vice president of business development and global expansion of the crypto exchange Luno. “The interest of various governments, and in particular the United States, in introducing regulation in the crypto space has not been higher.”

Ayyar predicts that next year will bring further clarity to cryptocurrencies other than bitcoin and ether, which the SEC says are not securities. Currently, Ripple, a blockchain company, is being sued by the SEC for selling their tokens, which the regulatory watchdog says are unregistered security; Ripple countered, saying tokens should not be classified as a security.

Stablecoins should also come under the regulatory lens, as the SEC examines whether there are enough underlying collateral to provide stability; previous collapses in collateral stability have been observed during the mortgage and housing crises.

DeFi should also be the subject of continued scrutiny and possible regulation. The Bank for International Settlements called for DeFi to be regulated this month, fearing that services claiming to be decentralized actually were. DeFi remains a point of contention and concern for regulators in the United States, and pressures are expected to increase in 2022.

By investing in companies that work in the crypto economy instead of directly in cryptocurrencies, investors can diversify their risks. The Bitwise Crypto Industry Innovators (BITQ) ETF offers investments in some of the largest crypto companies in a variety of segments.

BITQ tracks the Bitwise Crypto Innovators 30 Index, an index with at least 85% allocation to companies that are cryptocurrency exchanges carrying bitcoin and other cryptocurrencies, crypto miners, companies in mining equipment and service providers. The remaining 15% is allocated to large cap support companies with at least a large portion of their business dedicated to crypto.

BITQ carries crypto companies like Coinbase Global Inc (COIN), a major crypto exchange, at 10.49%; Silvergate Capital (SI), a bank that provides services for crypto exchanges, at 9.85%; and crypto mining companies such as Hut 8 Mining (HUT) at 4.28%.

The fund has an expense ratio of 0.85% and net assets of nearly $ 127 million.

For more news, information, and strategy, visit Crypto Channel.

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