Wild West No More: Regulation comes to the crypto corral


Think of regulation as a layer of trust

To be able to innovate and build an ecosystem that is used by and benefits global businesses and institutions, as well as by the average individual, the common denominator we must establish is trust.

Regulation can equal transparency


The dual challenges of security and regulatory compliance — on top of our own commitment to weaving transparency into everything we do — means that we need the equivalent of constant airworthiness checks and need to act a bit like our own version of air traffic control. While there really isn’t such a thing — or shouldn’t be — as “self-regulation”, we do take the mandate to foster trust seriously, meaning that we are mindful of, for example, such possibilities as:

  • Security: Breaches, exploits, hacks, etc.
  • Regulation and compliance: Ensuring we don’t run afoul of constantly developing regulatory frameworks
  • Internal controls: Are we vigilant enough? Are we secure enough? Are we transparent enough? Are we testing enough, doing enough QA?

Current state of regulation and compliance

Coinfirm, a regtech compliance company, published a cryptocurrency exchange risk report in March 2019, in which they highlight that more cryptocurrency exchanges are moving toward regulatory compliance, and they estimate that in the near future, companies will be categorised as engaging in “regulated activity” and “unregulated activity”. Nevertheless, even with movement toward compliance, the report examined 216 global crypto exchanges and found that only 14 percent of them were licensed by regulators. Only about a quarter of the exchanges had clear know-your-customer and anti-money laundering regulations in place.

  • Easier mainstream adoption
  • Consumer protections
  • Streamlining payments/cutting out middlemen
  • Attracting legitimacy
  • Attracting investment in the sector
  • Partnerships with financial institutions
  • Partnerships with other ecosystem players, leading to greater cooperation, innovation, invention

The next regulatory wave

Oversight is increasing all the time. In June, the Financial Action Task Force (FATF) introduced its “travel rule”, which requires transactions between exchanges to include personal information about the sender and receiver (not unlike the existing SWIFT transfer system for fiat currencies). These kinds of moves will likely drive away some of the crypto pioneers and cowboys, but will hopefully create an environment that is both consumer-friendly and business-friendly, attracting investment, particularly from the traditional financial sector. For our part, we recently announced our partnership with Norway’s Sparebanken Øst, which signals a growing openness within mainstream institutions for doing business with and innovating around digital assets and blockchain technology.



Norwegian Block Exchange (NBX) is a pioneering, truly Norwegian cryptocurrency exchange, custodian and a payment system. Sign up at https://nbx.com ✔️

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NBX Editorial

NBX Editorial: The voice of the Norwegian Block Exchange, a pioneering cryptocurrency exchange & payments platform that’s dedicated to the tokenized future.