It seems that a pattern is emerging between nations in favour of cryptocurrency and those that want to quash it. The two most populous nations on earth are stamping on bitcoin and its brethren, while smaller states are embracing it with their own rule books.
Belarus is among a handful of smaller countries coming up with specific rule books for digital currencies. Their efforts could help shape the development of the global market and the growth of industry players, from exchange platforms to brokers.
So far, cryptocurrency companies have often had to choose between two extremes when deciding where to set up shop.
Major financial centers like London and New York, which apply traditional financial services rules to the sector, might be attractive to big institutions seeking safety but the compliance complexity and costs preclude many of the startups at the heart of the fledgling industry.
The likes of Belarus and other newer entrants – including Bahrain, Malta and Gibraltar – are seeking to offer a third way: crafting specific rules for the cryptocurrency sector, betting they can attract companies by providing regulatory security as well as perks like tax breaks.
While there is no guarantee of success, cryptocurrencies represent a rare chance for these states or territories to grab a slice of an emerging market, potentially attracting investment and creating jobs, at a time when big financial hubs are adopting a more conservative, “wait-and-see” approach.
There is a thin line however, and getting these regulations wrong could open the digital doors to all manner of nefarious activities which would rile the bigger players and possibly ruin the reputations of smaller nations aiming to be a part of the crypto scene.
Belarus entrepreneur Prokopenya, whose Instagram posts of sports cars in Cyprus and beaches in Dubai are followed by 5.6 million people, acknowledged the risks that came with blockchain technology, including the potential for money laundering.
But he said these could be mitigated with clear regulation, and that countries like Belarus should not miss out on a chance to grab a slice of an emerging market.
“The biggest risks come from not taking any risks,” he said.