In crypto it is better to ask for forgiveness than permission

The recent case of Binance founder Changpeng Zhao pleading guilty to money laundering violations and receiving a lenient four-month prison sentence highlights a pervasive sentiment in the crypto world: it's often better to ask for forgiveness than permission. Despite the gravity of his actions, the consequences are relatively mild, raising questions about accountability and regulation in the crypto sphere. In the same time I agree that fast pace innovation often jumps over technicalities, but only if crypto businesses will limit themselves to that and not consciously pass the legal line. Which often does happen and the result is that the trust is tainted in a converging tech industry.

Seeing that in crypto is better to ask forgiveness than permission, got me thinking to why this is possible and few reasons came to mind. Here are some of them.

Gray area crypto regulation

Cryptocurrency still operates in a regulatory gray area, with laws and guidelines varying widely across jurisdictions and countries. This ambiguity can lead to uncertainty for crypto businesses and users alike. Faced with unclear regulations, many choose to push boundaries and innovate first, seeking forgiveness if they overstep legal bounds later.

Decentralization principles

One of the fundamental principles of crypto is decentralization, which empowers individuals and communities to transact and innovate without relying on traditional intermediaries or authorities. This autonomy encourages a culture of experimentation and risk-taking, where individuals are more inclined to take bold actions without seeking prior approval. In the same time governments don't like decentralization as they cannot control it, which transformed the crypto space into a fight for freedom. Who will win in the end? I think we already know, but we can still fight the good fight.

Speed of innovation

The pace of innovation in the crypto space is relentless, with new projects and technologies emerging at breakneck speed. In such a fast-moving environment, waiting for regulatory clarity can stifle progress and competitiveness. By forging ahead and adapting to legal pathways, innovators can maintain momentum and seize opportunities in a rapidly evolving landscape. Still, this creates opportunities for scammers and fake projects as there is minimum control when coming to market.

Historical consequences

Historically, the consequences for regulatory violations in the crypto industry have often been minimal compared to traditional financial sectors. High-profile cases like Zhao's lenient sentencing contribute to a perception that the risks of regulatory non-compliance are outweighed by potential rewards. This leniency can embolden individuals and businesses to take calculated risks, knowing that the fallout may be manageable. Still, if due money and investments are recovered or never been at risk, I believe that there is less harm done.

While seeking forgiveness over permission may offer practical advantages in the crypto space, it also raises ethical questions about accountability and responsibility. Embracing a culture of forgiveness can undermine trust and integrity within the industry, potentially eroding public confidence and inviting increased regulatory scrutiny in the long run. I believe that crypto should be regulated, but fairly and not for example accounting every little transactions that you make. A simple system like paying taxed on the profits you take out, will provide the freedom to experiment and strategize in a space that changes continuously.

Posted Using InLeo Alpha