Crypto Weekly: Let’s talk about regulation once again Crypto Weekly: Let’s talk about regulation once again Crypto Weekly: Let’s talk about regulation once again

Crypto Weekly: Let’s talk about regulation once again

Mads Eberhardt

Cryptocurrency Analyst

Summary:  Several countries addressed cryptocurrencies in the past week fueling the discussion of potential regulation. Despite this, more than $2bn was raised to cryptocurrency companies and projects last month. Having raised over $300mn in June, one notable project, Solana, had an outage of around 18 hours last week.

Once more, regulation is the main focus

Across the globe, the crypto market is to some extent unregulated or at least vaguely regulated through local and often aged laws which originally were not intended for cryptocurrencies. With the increasing market capitalization of the crypto space and the growing on-chain activity over the past year, regulators are increasing their focus on cryptocurrencies. Market participants should be increasingly aware of how regulation can affect the market in both a positive and negative manner.

Lately, particularly stablecoins have been attracting the attention of regulators as the supply has grown from $29bn to $123bn year to date. Over the last week, several major US-based newspapers have been reporting that stablecoins are presumably the most important conversation in Washington financial circles as regulators are examining how to properly regulate stablecoins. According to Bloomberg, officials even consider instituting a formal review by the Financial Stability Oversight Council to conclude whether stablecoins pose a threat to the economy. The impact on the crypto market by regulation on stablecoins should not be underestimated as stablecoins act as a cornerstone in the crypto market due to the most liquid trading pairs being quoted in stablecoins, whereas the majority of decentralized finance protocols are built upon stablecoins. On the other hand, regulation of stablecoins can arguably emerge as a good thing as a proper regulatory framework and clarity for regulated entities can bring more stability in the space.

In Russia, the Central Bank has reportedly issued guidelines targeting banks to get the banks to halt fiat transfers to cryptocurrency exchanges. The intention is to avoid ‘emotional’ purchases of cryptocurrencies carried out by Russian investors, and thus protect investors from losses if the market ‘crashes to zero’, allegedly stated by the central bank. Throughout the years, there have been repeated talks for an outright cryptocurrency ban in Russia, though it has not come into effect.

Uzbekistan, on the other hand, banned cryptocurrency payments in late 2019, and the country will likely never ease its ban on cryptocurrencies, according to statements last week from the deputy chairman of the Central Bank of Uzbekistan, arguing that cryptocurrencies are backed by nothing.

Last week, Turkish President Recep Tayyip Erdoğan hosted a question and answers session. Here, an attendant asked Erdoğan about his opinion on cryptocurrencies, to which Erdoğan answered: “We have absolutely no intention of embracing cryptocurrencies”. Erdoğan added that the country is competing with cryptocurrencies as the country is far in the process of launching a Central Bank Digital Currency, known as CBDC, with its first tests scheduled for later this year.

Venture capital is finding its way into crypto-companies

Last month was markedly extraordinary in terms of venture capital being invested in cryptocurrency and blockchain companies and projects. According to TheBlock, nearly $2.1bn was invested in companies in the industry across 124 funding rounds. In Q2 2021, a total of $4.38bn was raised up from $2.89bn in the first quarter. With the cryptocurrency Avalanche raising $230mn last week, this third quarter will likely beat the total amount invested in Q2. In essence, the increased investment activity in cryptocurrency – and blockchain companies and projects indicates a growing belief in companies and projects serving the crypto – and blockchain industry.

The Solana network experienced an outage of 18 hours

Speaking of raising money, presently the seventh-largest cryptocurrency measured on market capitalization Solana, which raised $314mn in June this year, experienced an outage of around 18 hours last week. In the meantime, users were unable to send transactions and interact with the network as a whole, effectively meaning funds on the blockchain were inaccessible, including stablecoins. With Solana officially being in beta version, the outage was due to the network being flooded with an unmanageable amount of transactions leading the network to go down. Afterward, a hotfix was implemented to avoid it from happening again, with additional fixes to follow to make the solution airtight. The outage shows how fragile cryptocurrencies currently are, particularly the newer ones which have not been tested in all conditions. To sum up, the outage does likely not help in forming favorable stablecoin regulation, as it is not suitable to have billions in stablecoins on a network inaccessible for around 18 hours.
Source: Saxo Group
Source: Saxo Group


The Saxo Group entities each provide execution-only service, and access to analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular, no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Trading in financial instruments carries risk, and may not be suitable for you. Past performance is not indicative of future performance. Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.

Saxo Markets
88 Market Street
CapitaSpring #31-01
Singapore 048948

Contact Saxo

Select region


Saxo Capital Markets Pte Ltd ('Saxo Markets') is a company authorised and regulated by the Monetary Authority of Singapore (MAS) [Co. Reg. No.: 200601141M ] and is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Risk Warning to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as Margin FX products may result in your losses exceeding your initial deposits. Saxo Markets does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Markets does not take into account an individual’s needs, objectives or financial situation.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website are not intended for residents of the United States, Malaysia and Japan. Please click here to view our full disclaimer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.