By XBTPro on The CapitalA cryptocurrency is a virtual currency and controlled by the cryptography. This system has disabled the action like double-spending or counterfeiting. A defining feature of cryptocurrency is that no central authority can issue this. So it is totally out of the intervention or manipulation of central government or authority.So it suggests that there are regulations regarding the use of cryptocurrency around the world. While some nations have whole-heartedly invited the use of cryptocurrency, the others are unbothered of permitting this digital currency.The use of cryptocurrency has mixed reactions in the market. On the one hand, the use has been praised for its portability and divisibility. On the other hand, there are harsh criticisms regarding its illegal trading, which is giving rise to various economic issues in the economies.Crypto Trading Regulation and Illegal ActivitiesAs the circulation of cryptocurrency has spread across the world, terms and regulations are put in place to try and govern them. So the global regulators are divided on how to keep it up. As most of the digital currencies are not backed by the central authority, means each country has different regulatory standards for them.The price of the cryptocurrency can be affected by the regulatory acts in a country. Like in 2018, every seemingly small regulation announcement had a great impact on the price of Bitcoin and other cryptocurrencies.At the G-20 meeting in 2018, Argentina’s central bank governor outlined a summer deadline for members to decide on acceptance of cryptocurrency. By July it was proposed to submit the outline for it. In this regard, Italy’s central bank showed a response that cryptocurrencies would pose risk but should not be banded.The Financial; Stability Board, which runs financial regulation for G-20 economies expressed a cautious tone in response to many countries’ decision to crack down on digital currencies.The IMF’s Managing Director Christine Lagarde highlights that it might be possible that cryptocurrency turns into a vehicle for money laundering. It also facilitates in financing terrorist activities. So she has called for policies to protect the consumers in the same way as the traditional financial sector.There are few countries where the cryptocurrency is legal. To name a few- the US, Morocco, Nigeria, Canada (though banned by banks) Australia. But then there are China, Russia, Vietnam, Bolivia, etc. which haven’t legalized the transaction of cryptocurrencies.But with growing popularity, cryptocurrency users are facing various regulatory challenge including illegal trades (drugs, hacks, thefts, illegal pornography, even murder-for-hire). It has indeed risen as a great device for the terrorists. It is even avoiding capital control.The anonymity payment mechanism of cryptocurrency like Bitcoin is facilitating the growth of darknet. This darknet is an illegal place where illegal people trade goods and services.Many research papers have quantified the number of illegal activities that involve the largest cryptocurrency, Bitcoin. The recent FBI seizure of over $4 million of Bitcoin has given an idea of such market place, Silk Road. The whole incident is providing an idea of the scale of the problem faced by the regulators.According to the researchers, one-quarter of all users (25%) and close to one-half of the bitcoin transaction are associated with an area of illegal activities. The cryptocurrencies are even enabling the black market e-commerce.On the other side, every year the price of cryptocurrencies is falling or rising. So betting on cryptocurrencies, specifically, bitcoin is normal amongst the people. But such culture is in reality leading to the path of gambling.ConclusionIn recent years the proportion of cryptocurrencies associated with illegal trade has declined there are two reasons for this. The first one is increasing in mainstream and speculative interest in cryptocurrencies. This has led to a decline in the proportion of illegal activities.The second reason is the emergence of other alternative cryptocurrencies like Dash, Monero and ZCash. Those are more opaque and better at concealing a user’s activity.Despite these two factors affecting the use of cryptocurrencies in illegal activities and law enforcement, numerous darknet marketplace seizures, the illegal activities are still close to its all-time high. The calculation is based on the absolute terms of illegal activities.With a hope to reduce such activities, policy interventions are very important and the law enforcement officers. And the country head should be concerned about cryptocurrency surveillance including monitoring trends of the illegal trades.The Capitalhttps://medium.com/media/3b6b127891c5c8711ad105e61d6cc81f/hrefIllegal Trading Crypto Terms was originally published in The Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.