ASSIGNMENT COVER SHEET

STUDENT DETAILS

Student name: Huynh Nguyen Long Student ID number: B1112016570

UNIT AND TUTORIAL DETAILS

Unit name: Business Law Unit number:

Thursday
Tutorial/Lecture: BL-T321WSB-4 Class day and time: 15:30 – 18:45
Lecturers: James Weisman & Ha Thi Thanh Binh

ASSIGNMENT DETAILS

Title: The Past, Present & Future of Cryptocurrency in Worldwide Legislation

1440
Length: words Due date: December 5th 2021 Date submitted: December 5th 2021

DECLARATION

I hold a copy of this assignment if the original is lost or damaged.

I hereby certify that no part of this assignment or product has been copied from any other student’s work or
from any other source except where due acknowledgement is made in the assignment.
I hereby certify that no part of this assignment or product has been submitted by me in another (previous or
current) assessment, except where appropriately referenced, and with prior permission from the Lecturer /
Tutor / Unit Coordinator for this unit.
No part of the assignment/product has been written/ produced for me by any other person except where
collaboration has been authorised by the Lecturer / Tutor /Unit Coordinator concerned.
I am aware that this work may be reproduced and submitted to plagiarism detection software programs for the
purpose of detecting possible plagiarism (which may retain a copy on its database for future plagiarism
checking).

Student’s signature: Huynh Nguyen Long

Note: An examiner or lecturer / tutor has the right to not mark this assignment if the above declaration has not
been signed.
 MINISTRY OF EDUCATION AND TRAINING

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

INTERNATIONAL SCHOOL OF BUSINESS

BUSINESS LAW

THE PAST, PRESENT & FUTURE

OF CRYPTOCURRENCY

IN WORLDWIDE LEGISLATION

STUDENT NAME: HUỲNH NGUYÊN LONG

STUDENT ID: B1112016570

HO CHI MINH CITY, 2021

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TABLE OF CONTENTS
TABLE OF CONTENTS................................................................................i

LIST OF FIGURES........................................................................................ii

CHAPTER ONE: INTRODUCTION............................................................1

CHAPTER TWO: THE PAST & PRESENT.................................................3

CHAPTER THREE: THE FUTURE & CONCLUSION...............................6

REFERENCE.................................................................................................7
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LIST OF FIGURES

CHAPTER ONE
Figure 1.1. Overview of differences between currency types (Jiang, 2020)..............................1

Figure 1.2. “Cryptocurrency” search trend throughout the years (Google Trends, 2021a).......2

Figure 1.3. Top global news searches, 2017 (Google Trends, 2021b).......................................2

CHAPTER TWO

Figure 2.1. BTC historic trading values (Webster, 2021)..........................................................4

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CHAPTER ONE: INTRODUCTION

Cryptocurrency is a relatively recent development in the timeline of human innovations.

It is defined as a digital collection of data that is secured through cryptography, and one that

is used as a medium of exchange (Frankenfield, 2021).

The creation of the first cryptocurrency is widely accredited to Dr. David Chaum, an

American computer scientist and cryptographer. In 1983, he published a research paper

which theorized an anonymous and cryptographic system of payment using money stored in a

digital format, or eCash (Chaum,1998).

Cryptocurrency carries many unique properties that distinguish itself from other

traditional currencies (Lansky, 2018). Firstly, cryptocurrencies are digitalized, meaning that

they do not physically exist. Secondly, they are fiat money, so they do not inherently carry

intrinsic value backed by any commodity. Thirdly, they mostly operate under the principle of

decentralized control, and as a result they do not require a central distributor, such as a bank

or government. The strong cryptographic elements, which apply to both the minting and the

exchange of the currencies, also promote privacy, security and anonymity.

Figure 1.1. Overview of differences between currency types

(Jiang, 2020).
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The technology has greatly transcended its novelty in recent years, garnering

tremendous attention from the general public as well as mainstream media. Notable

cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH), manage to amass a

considerable following due to their promising prospects. Investors are recognizing their

potential to replace traditional currencies in the future, as they carry the aforementioned

practical advantages. According to Google Trends (2021a), the keyword “cryptocurrency”

has begun gaining noticable, albeit fluctuating worldwide traction since 2017. In that same

year, however, “Bitcoin” was the second-most searched term wolrdwide in the category of

global news (2021b).

Interest in "cryptocurrency" over time

(measured in percentages relative to peak popu-
larity)
100
90
80
70
60
50
40
30
20 Figure 1.3. Top global
10 news searches, 2017
0 (Google Trends, 2021b).
2005
2006
2007

2009

2011

2013

2015

2017
2018
2019

2020
2021

Interest

Figure 1.2. “Cryptocurrency” search trend throughout the years

(Google Trends, 2021a).

The increasing fervor around the invention, both among the general public as well as

the global financial investment landscape, has cultivated numerous discussions and

arguments regarding how cryptocurrencies should be regulated and governed.

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In this essay, I aim to chronicle the history of cryptocurrency regulations and legislation

in prominent economies around the world, provide in-depth analyses on the effectiveness and

consequences of those policies, as well as propose the outlook of cryptocurrency lawmaking.

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CHAPTER TWO: THE PAST & PRESENT

In the beginning, there were many attempts to establish a new medium of payment that

made use of computer advancements at the time. Examples include the 1998 proposal of b-

money, authored by the computer engineer Wei Dai, which outlined properties of an

anonymous electronic cash system that would become the basis of modern cryptocurrencies

(Dai, 2021). While the concept ultimately failed to capture enough attention to officially take

off, it succeeded in inspiring future cryptographers and developers to redesign subsequent

systems with its groundworks.

In 2009, Bitcoin was released as an open-source network, marking it the first

cryptocurrency to be officially launched. A white paper, authored by the anonymous creator

of Bitcoin, was also publicized a few months prior, which explained the ideologies of the

cryptocurrency, as well as its fundamental mechanisms and system. Within the next few

years, Bitcoin would be gradually and jointly developed by other computer scientists under

the guidance of the creator and the ensuing Bitcoin Foundation. The cryptocurrency has since

been completed and became fully operational, inspiring further generations of

cryptocurrencies to follow its historic footsteps.

The first recorded transaction using cryptocurrency, specifically Bitcoin, was made in

2010, when a programmer ordered and paid for two pizzas with 10,000 BTC (Kharpal, 2018).

However, cryptocurrency did not have a notable presence in the global economic setting.

Usages of Bitcoin at this time continued to be generally bound to niche and particularly

illegal activities, such as online black markets. Bitcoin’s value also remained low from the

beginning, ranging from 30 cent USD per BTC in 2011 to around 13 USD from 2013

(Webster, 2021).

Bitcoin began receiving tremendous attention from the media as a novelty investment

opportunity when its value leaped enormously within only a few years.
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Trading price of 1 BTC

(measured in USD on January 1st of each year)
30000
27500
25000
22500
20000
17500
15000
12500
10000
7500
5000
2500
0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Price

Figure 2.1. BTC historic trading values (Webster, 2021).

The success of Bitcoin in the last decade has managed to push the cryptocurrency

market to the forefront of the investing ecosystem, resulting in the creation of numerous new

cryptocurrencies, as well as sparking discussions among governments around the world in

how to regulate the new wave of investors.

In the USA, governing bodies take conflicting stances in regards to how to precisely

classify cryptocurrencies. More specifically, the Securities and Exchange Commission (SEC)

views cryptocurrency as a security, while Bitcoin is referred to as a commodity by the

Commodity Futures Trading Commission (CFTC). There are some regulatory mandates that

are uniformly applied, such as the obligations of anti-money laundering and combating the

financing of terrorism (Smith, 2021).

Following the historic value jump of Bitcoin in 2013, the US Department of Treasury’s

Financial Crimes Enforcement Network (FinCEN) released regulatory guidelines for

decentralized currencies, which stated that “virtual currencies do not have legal tender status

in any jurisdiction" (2013). In that same year, the US authorities seized some accounts

associated with the Japanese Bitcoin exchange service, Mt. Gox, as the company failed to
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register itself as a money transmitting company in the country, and thus the CEO potentially

faced imprisonment (Dillet, 2013).

Japan became one of the earliest adopters of Bitcoin, which also spearheaded the

country to become the world’s leading hub of cryptocurrency trading. Under the Payment

Service Act, which was released and modified since 2016, classified Bitcoin and others of its

kind, as well as established some specific regulations to cryptocurrencies (2016).

In China, the government has remained a firm opponent of decentralized currencies. In

2013, the People’s Bank of China prohibited the usage of Bitcoin by all Chinese financial

institutions, and then subsequently declare all crypto transactional and mining activities

illegal in 2021 (Qin, Livni, 2021). Outside of China, a few countries also impose a ban on

cryptocurrencies, such as Nepal (Nepal Rastra Bank, 2021), Egypt and Algeria (Law Library,

2018). Meanwhile, Vietnam allows the trading of Bitcoin, but prohibits the issuance and

usage of BTC as a means of payment (Xuan, 2017).

In 2015, the European Union (EU) decided that bitcoin is legally a currency, and

established a few basic regulations regarding the exchange of other currencies into BTC, as

well as how such exchanges interact with the existing frameworks for taxes (2015).

In 2021, the Central-American nation of El Salvador became the first country in the

world to approve Bitcoin as a legal tender (Ostroff, 2021).

As of the time of writing, most governments allow, or otherwise do not strictly prohibit,

the mining and trading of cryptocurrencies. Many national governments, especially those of

developed economies, have established guidelines or legal frameworks for virtual currencies

in response to the growing demand for crypto investing.

While the view on cryptocurrencies varies greatly between nations, and occasionally

between national governing organizations, it is apparent that global economies do not see

cryptocurrencies as a particular risk to societal order or national security.

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CHAPTER THREE: THE FUTURE & CONCLUSION

The overall lack of general regulations and uniform policies between economies and

industries around the world proves to be a major overhang of cryptocurrency investment. The

volatile nature of the asset combined with the unstable decision-making of governments

actively impedes the development of cryptocurrency’s potential to be fully realized as a

future replacement of traditional currency. According to the chairman of the US SEC Gary

Gensler, stricter regulative actions are required to protect investors from unnecessary risks

(Haar, 2021).

With ongoing developments from many countries, it is difficult to accurately predict the

direction of cryptocurrency regulations in the future. Nevertheless, one can infer that there

will be increasing acceptance of the idea, and as cryptocurrencies continue to push forward

innovations and economic growth, the finance and economic scene will become invariably

changed.

In conclusion, Bitcoin in particular and other cryptocurrencies as a whole have

experienced many alterations in regulations in the past, and it is expected that they will be

experiencing further dramatic changes in the litigation landscape as the need to control the

novel currencies continues to rise.

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REFERENCE

Chaum, D. (1989). Blind Signature For Untraceable Payments.

The exchange of traditional currencies for units of the ‘bitcoin’ virtual currency is exempt
from VAT. (2015, October 22). Court of Justice of the European Union. Retrieved
December 5, 2021, from https://curia.europa.eu/jcms/upload/docs/application/pdf/2015-
10/cp150128en.pdf.

FinCEN, Application of FinCEN’s Regulations to Persons Administering, Exchanging, or

Using Virtual Currencies (2013). Retrieved December 5, 2021, from
https://www.fincen.gov/sites/default/files/shared/FIN-2013-G001.pdf.

Frankenfield, J. (2021, December 3). What is cryptocurrency? Investopedia. Retrieved

December 5, 2021, from https://www.investopedia.com/terms/c/cryptocurrency.asp.

Google Trends. (n.d.). Retrieved December 5, 2021, from

https://trends.google.com/trends/explore?date=all&q=%2Fm%2F0k2kj45,%2Fm
%2F0_x5x3g,%2Fm%2F0134xwrk,%2Fm%2F0b6h18n.

Google. (n.d.). Google's year in Search. Google Trends. Retrieved December 5, 2021, from
https://trends.google.com/trends/yis/2017/GLOBAL/.

Ian, W. (2021). Bitcoin historical prices. Bitcoin Price Chart and Tables | Finance Reference.
Retrieved December 5, 2021, from https://www.officialdata.org/bitcoin-price.

Japan: Bitcoin to be regulated. The Library of Congress. (2016, November 4). Retrieved
December 5, 2021, from
https://www.loc.gov/item/global-legal-monitor/2016-11-04/japan-bitcoin-to-be-
regulated/.

Kharpal, A. (2019, April 12). Everything you need to know about the blockchain. CNBC.
Retrieved December 5, 2021, from https://www.cnbc.com/2018/06/18/blockchain-
what-is-it-and-how-does-it-work.html.

Lansky, J. (2018). Possible state approaches to cryptocurrencies. Journal of Systems

Integration, 9(1), 19–31. https://doi.org/10.20470/jsi.v9i1.335

Ostroff, C., & Pérez, S. (2021, June 9). El Salvador becomes first country to approve Bitcoin
as legal tender. The Wall Street Journal. Retrieved December 5, 2021, from
https://www.wsj.com/articles/el-salvador-becomes-first-country-to-approve-bitcoin-as-
legal-tender-11623234476.

Qin, A., & Livni, E. (2021, September 24). China cracks down harder on cryptocurrency
with New Ban. The New York Times. Retrieved December 5, 2021, from
https://www.nytimes.com/2021/09/24/business/china-cryptocurrency-bitcoin.html.
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Regulation of Cryptocurrency Around the World. (2018). Library of Congress. Retrieved

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https://tile.loc.gov/storage-services/service/ll/llglrd/2018298387/2018298387.pdf.

Ryan, H. (2021, November 9). Future of cryptocurrency in 2021 and beyond | nextadvisor
with Time. Time. Retrieved December 5, 2021, from
https://time.com/nextadvisor/investing/cryptocurrency/future-of-cryptocurrency/.

Smith, T. (2021, October 13). Cryptocurrency regulations around the world. Investopedia.
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T, X. (2017, October 28). Phát hành, Sử dụng tiền ảo sẽ bị xử lý hình sự. Báo Thanh Niên.
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ने पालमा bitcoin लगायतका cryptocurrency हरुको कारोबार गर्न पाइन्छ/पाइदै न ? ने पाल राष्ट् र
बैं क. (2020, November 13). Retrieved December 5, 2021, from
https://www.nrb.org.np/2020/11/%E0%A4%A8%E0%A5%87%E0%A4%AA
%E0%A4%BE%E0%A4%B2%E0%A4%AE%E0%A4%BE-bitcoin-
%E0%A4%B2%E0%A4%97%E0%A4%BE%E0%A4%AF
%E0%A4%A4%E0%A4%95%E0%A4%BE-cryptocurrency-
%E0%A4%B9%E0%A4%B0%E0%A5%81%E0%A4%95%E0%A5%8B/.