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Cryptic Regulation of Crypto-Tokens

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  • Joshua S. Gans

Abstract

This paper investigates the alignment of existing securities regulations with the emerging landscape of crypto-tokens and blockchain technology. By examining the features of these digital assets, including decentralization, consensus mechanisms, and programmability, we analyze how they interact with existing financial rules. We compare approaches to regulation across countries, considering potential impacts on innovation. Furthermore, we explore the issues that may arise with blockchain networks, such as payment efficiency and market safety. The study aims to contribute to discussions about balancing innovation within the blockchain sphere and ensuring investor protection and market security, underlining areas that may necessitate regulatory improvements.

Suggested Citation

  • Joshua S. Gans, 2023. "Cryptic Regulation of Crypto-Tokens," NBER Working Papers 31301, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:31301
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    References listed on IDEAS

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    1. Joshua S. Gans & Hanna Halaburda, 2015. "Some Economics of Private Digital Currency," NBER Chapters, in: Economic Analysis of the Digital Economy, pages 257-276, National Bureau of Economic Research, Inc.
    2. Robert Akerlof & Richard Holden, 2016. "Movers and Shakers," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(4), pages 1849-1874.
    3. Joshua S. Gans & Richard Holden, 2023. "A Solomonic Solution to Blockchain Front-Running," AEA Papers and Proceedings, American Economic Association, vol. 113, pages 248-252, May.
    4. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 24(Win), pages 14-23.
    5. Halaburda, Hanna & He, Zhiguo & Li, Jiasun, 2023. "An Economic Model of Consensus on Distributed Ledgers," Research Papers 4137, Stanford University, Graduate School of Business.
    6. Joshua Gans, 2023. "The Economics of Blockchain Consensus," Springer Books, Springer, number 978-3-031-33083-4, December.
    7. Christian Catalini & Alonso de Gortari & Nihar Shah, 2022. "Some Simple Economics of Stablecoins," Annual Review of Financial Economics, Annual Reviews, vol. 14(1), pages 117-135, November.
    8. Hanna Halaburda & Guillaume Haeringer & Joshua Gans & Neil Gandal, 2022. "The Microeconomics of Cryptocurrencies," Journal of Economic Literature, American Economic Association, vol. 60(3), pages 971-1013, September.
    9. Kocherlakota, Narayana R., 1998. "Money Is Memory," Journal of Economic Theory, Elsevier, vol. 81(2), pages 232-251, August.
    10. Chen, Conghui & Liu, Lanlan, 2022. "How effective is China's cryptocurrency trading ban?," Finance Research Letters, Elsevier, vol. 46(PB).
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    12. Hanna Halaburda & Zhiguo He & Jiasun Li, 2021. "An Economic Model of Consensus on Distributed Ledgers," NBER Working Papers 29515, National Bureau of Economic Research, Inc.
    13. Jiageng Liu & Igor Makarov & Antoinette Schoar, 2023. "Anatomy of a Run: The Terra Luna Crash," NBER Working Papers 31160, National Bureau of Economic Research, Inc.
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    JEL classification:

    • K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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