In the most objective way possible, this text seeks to analyze the pros and cons of regulated and unregulated blockchains.
Blockchain technology (also known as “trust protocolIt has received a lot of attention in recent years, with many experts touting its potential to revolutionize various industries. However, not all blockchains are created equal. Some are regulated and some are not. Understanding the difference between the two is crucial. For companies and individuals who want to take advantage of this technology.
Before getting into the main topic itself, let’s take a quick look at the general concept of making life easier for those less familiar with the technology involved:
Blockchain, or as we called it at the beginning, “Protocol of Trust”, is a decentralized digital ledger that records transactions on a computer network. Encryption is used to protect and verify transactions, creating a tamper-proof record that is publicly accessible and verifiable, allowing for greater transparency and security. The technology is most commonly associated with cryptocurrency, but has the potential to be applied to a wide range of industries such as finance, supply chain management, and voting systems. It allows creating a reliable, transparent and secure environment for recording transactions, contracts and agreements.
To regulate or not to regulate, that is the question
According to an article published by MakeUseOf, a regulated blockchain is one that complies with government regulations and laws. This means that all transactions are recorded on the regulated blockchain and can be traced back to the authorities. On the other hand, the unorganized operates outside the supervision of the government. This means that transactions in unregulated transactions are not recorded and cannot be traced by the authorities.
One of the main advantages of a structured “trust protocol” is that it is more transparent and accountable than an unregulated one. Regulations that a regulated blockchain must comply with ensures that all transactions are recorded and traceable, increasing trust and security for users and businesses alike. This is a huge benefit for sectors such as finance, where trust and security are paramount.
However, unregulated blockchains have more freedom regarding their operations. They are not subject to the same regulations and can operate in a more decentralized manner, which can be seen as an advantage for some companies and individuals. For example, companies operating in unregulated sectors such as cannabis can benefit from the decentralized and unregulated nature of the blockchain.
Another advantage of unregulated blockchains is that they are usually more private and anonymous than regulated ones. Transactions on unregulated blockchains are not recorded, which means they cannot be traced back to the authorities. This can be seen as an advantage for companies and individuals who value their privacy and anonymity.
In short, both regulated and unregulated blockchains have their advantages and disadvantages. Regulated companies are more transparent and accountable, which can be seen as an advantage for sectors such as finance. On the other hand, unregulated companies have more freedom in their operations and are usually more private and anonymous, which can be seen as an advantage for some companies and individuals. The choice to commit to regulated or unregulated technology depends on the specific needs and requirements of each company or individual.
It should be noted that the information in this article is based on the content of the linked site, and it is important to consult experts and do your own research before making any decision.
Author: Marcelo Roncat
History student and retired trader. He remains firm as a bitcoin enthusiast and avowed foe of financial pyramids.