New trends in Crypto transactions

A trend is defined as the general direction in which something will be developing or changing (Oxford Dictionary). Something which involves a prediction of the future. Alan Kay (1940), an American computer scientist, said that “the best way to predict the future is to invent it”.
The functions of money a) a medium of exchange b) a unit of account (standard of value) and c) a store of value.
In 2021, Spain is the 5^th country in crypto transactions in Europe after UK, France, Germany, and Holland. Other important actors are Switzerland and Italy.

• 1st Trend: DEFI (decentralized Finance). The World is moving away from regulated Banks and official stock markets. Loans in fiat currency (or even in crypto) secured by a crypto portfolio are becoming increasingly popular in certain countries. This can be done without a license in the European Union, but the loan is subject to consumer protection legislation. Directive 2008/48 of 28 April 2008 and Spanish law 16/2011. Excluded contracts of less than 200€ or with a term of less than 3 months or more than 75.000 €.

In Spain crypto secured loans are not available because necessity of enforcement of the security in a public auction.

New trend: loans granted in crypto currencies with no security.

• 2nd Trend: The necessity of a regulatory framework. Crypto Operations cannot expand and attract massive clients unless they are properly regulated. EU is one step ahead of the game because of MICA regulation (but it will not enter into effective until 2025).Uncertainty in the U.S. after FTX collapse, lawsuit against Binance by Commodities Futures Trading Commission (non-registration in the U.S. and using of high-speed trading platforms in derivatives).

MICA regulation has certain drawbacks:  a) a requirement of minimum capital, b) expert people as directors of MICA´s companies, and c) banks excluded from MICA requirements.

MICA is a pro-bank regulation not in line with the necessities of small financial entrepreneurs. A consequence of MICA there will be a consolidation of the crypto market; large companies will take over small companies with less resources to comply with the new requirements.

• 3^rd Trend: Crypto companies carrying out payment services directly or through electronic money, which are licensed businesses. The issue here is that most crypto platforms have applications which could be easily accessible to pay merchants and shops. Crypto is not legal tender but with their applications, conversion into fiat currency is feasible without any difficulty. Crypto Hybrid entities.
• 4^th Trend: MICA regulation will facilitate raising money through coin offerings and security tokens (offering a reward) which will make the security tokens being considered as investment or financial products. A consequence will be the expansion of “reverse solicitation”, the purchase of crypto assets on the exclusive initiative of the purchaser without any communication of the issuer, the broker, or the investment services company and this will facilitate the sale of crypto assets to EU residents by crypto operators from third countries: U.S., China and Singapore, Japan, etc.
• 5^th Trend: cryptocurrencies may become more stable. US. Dollars, Euros, and sterling pounds are affected by high inflation rates and to a certain extent manipulated by the respective central banks. Central banks have limited independence from governments, as we see nowadays. Bitcoin and Ethereum will be more used as a store of value, like gold, silver, platinum, etc.. Private banking will enter into this business. This will be done via selling to clients’ funds investing part of its assets  in crypto  shares or notes issued by crypto issuers or traders
•  6^th Trend: Utility tokens – digitalization of the work of arts and payment in cryptos– limited number of copies, and a development of a trade in this area. The dome painted by Miquel Barceló in meeting room of HRC (Human Rights Commission) in Geneva. Copyright law implications.
• 7^th Trend: Potential increase of fraud and digital currencies. A report of the Bank of Spain in 2022. For the time being, 1% of the transactions between June 20 and June 21. Around 60% is fraud and stealing of funds (32%).