# Tortoises and hares By [rollinro.eth](https://paragraph.com/@rollinro) · 2023-08-24 --- Treating crypto trading as gambling would also mean taking a risk-based approach that focuses on mitigating downside risks. This is understandable, but it might be at the expense of potential upside opportunities. The UK [aspires to be](https://www.gov.uk/government/news/government-sets-out-plan-to-make-uk-a-global-cryptoasset-technology-hub) a leader on digital assets, potentially stealing a march on the US at a time when it seems [comparatively hostile](https://www.coindesk.com/consensus-magazine/2023/03/31/the-biden-administration-is-politicizing-crypto/) to the space. Particularly considering that financial services [make up 8%](https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwiH1aSd24j_AhW8QkEAHXPCAAUQFnoECAkQAw&url=https%3A%2F%2Fwww.economicsobservatory.com%2Fhow-important-is-the-city-to-the-uk-economy&usg=AOvVaw1idW1ogkcN3FtAgOQEm1kL) of the UK economy, there is a delicate balance to strike here. The UK government [has said](https://www.bbc.com/news/technology-65610851) that it does not agree with the Treasury select committee that crypto trading should be treated like gambling. Earlier this year, the [Treasury outlined](https://www.ft.com/content/6f5539f7-19ff-419b-8a64-5ed528de5abf?shareType=nongift) new principles to regulate crypto trading, which would essentially treat these assets in a similar way to shares or bonds. This is in stark contrast to, say, [China](https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwjYp9X93Yj_AhWVQEEAHdHMAQwQFnoECAcQAQ&url=https%3A%2F%2Fwww.weforum.org%2Fagenda%2F2022%2F01%2Fwhat-s-behind-china-s-cryptocurrency-ban%2F&usg=AOvVaw20xk0IbfQF7a5cEB0emgsy), which has banned cryptocurrency to “curtail financial crime and prevent economic instability”. Yet, equally, the UK’s proposed regime will probably be more robust than a country [such as Switzerland](https://www.pwc.com/gx/en/new-ventures/cryptocurrency-assets/pwc-global-crypto-regulation-report-2023.pdf), which is embracing crypto within a largely new framework for financial assets. The Swiss are so progressive that their financial regulator has [even permitted](https://zg.ch/en/steuern-finanzen/steuern/steuerbezug/steuern-bezahlen-mit-kryptowaehrungen#:%7E:text=As%20of%20February%202021%2C%20individuals,the%20cryptocurrencies%20Bitcoin%20and%20Ether.) the canton of Zug, near Zurich, to pay certain taxes in crypto. Welcome to Zug, Switzerland, where you can pay your taxes in crypto. [Henna K](https://www.flickr.com/photos/hennake/50522263538/in/photolist-2jYtNMh-sQ4Fzh-t5kpFL-2mNKFUT-2mNV36U-XjgWwR-t5kj55-2mWTXjf-2kCtFuw-2nevkYJ-2k78pad-2k8oK41-2drMkuL-2mQRpUT-2kTgSyu-DcJoFy-tYE6hP-2kBTF6z-GQgAH1-2kvPtCn-4Yw5wd-4Yw7PY-Usjf3C-ab586g-27KpVGz-2kCKWmJ-2kBJoyo-2kyPsxo-2i7rCJs-2kCeWkP-2km6JAP-uVuq6T-2jGQhx1-RKrTzq-LCbAN-2kBWSUp-UoBtub-uD2Baa-2kCSJdr-2kUPvsP-2jGAQh1-ocHBFq-2n1je6i-tYE8uV-uCZSaz-uD1oCt-vAEejm-oudsd8-2kh21Bu-uUZYfN), [CC BY-SA](http://creativecommons.org/licenses/by-sa/4.0/) Such disparate views on crypto regulation around the world point to one thing: uncertainty. Not around the technology as it stands today – though a surprising number even of senior policymakers don’t understand it – so much as what it could become. For example, with [upwards of 4 million](https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1089224/Individuals_Holding_Cryptoassets_Uptake_and_Understanding.odt) people in the UK having owned or used cryptocurrencies, regulators worry that individuals might pivot to a monetary system outside of their traditional currency by transacting in crypto instead. This might make it more difficult for central banks to control the economy. The risk of this pivot is probably remote, but not impossible. But trying to predict how it will play out is akin to forecasting the aviation industry when the Wright Brothers first flew, or the importance of the internet and smartphones when Steve Jobs [described the computer](https://www.youtube.com/watch?v=L40B08nWoMk) in 1990 as a “bicycle for the mind”. Overall, the UK’s approach to crypto regulation is cautious – perhaps you could spin it as a “fast follower” of the countries that are leading the way, such as Switzerland and [El Salvador](https://www.reuters.com/business/finance/imf-says-el-salvadors-bitcoin-risks-have-not-materialized-should-be-addressed-2023-02-11/). Given the economic existential importance of “what is money” and how it is used within an economy, this seems like the right balance to strike. When the consequences are so difficult to predict, it’s arguably better to take small steps rather than “[move fast and break things](https://www.masterclass.com/articles/move-fast-and-break-things)” in the style of Silicon Valley. After all, the UK is a country not a company and the stakes are higher if a policy choice does not pay off. Nonetheless, it’s surely right not to treat crypto trading like gambling. Let’s hope that future UK governments stick with this approach. Gambling over time is the road to ruin for the player – the house always wins. In crypto this is not true. There is no “house” but rather a value proposition which may or may not come to fruition, but oftentimes is still misunderstood. --- *Originally published on [rollinro.eth](https://paragraph.com/@rollinro/tortoises-and-hares)*