Opinion by: Kai Wawrzinek, Co-Founder of Impossible Cloud Network
It seems the penalty for the US Securities Exchange Commission Crypto Enforcement Era has ended, but former Chair Gary Gensler left us with some truffles. Even after his removal, the approach of “Gensler’s regulation by implementation” continues to be surprising.
We can live under the First pro-crypto administration in US historyBut there is still a mountain of work that should be done in a mess of chaos created by fuzzy, conflicting or none of the regulations. A crypto sector, in particular, requires clarity on how it is meant to work without getting angry by regulators: Decentralized physical infrastructure networks (DEPIN).
Definition projects, from decentralized cloud services to telecommunication and shared sensor grids, rely on real-world deployments and stable tokenomics. When regulators fail to express how the tokens and their management structures should be categorized, projects are left predicting – and, occasionally, ending in court.
Let’s deprive to do the thing its
While most of the crypto sectors are completely digital and never intersect with the physical world, the depin is different. The clue is in “physically” in depin. One of the well-known depin projects suggests users to deploy wireless hotspots to create a decentralized Internet of Things. Other depin projects include the development of decentralized cloud services, crowdsourcing environmental data, decentralized energy grids and more.
The intersection of blockchain, hardware and real-world services presents a unique set of regulation challenges that require appropriate solutions-solutions that are no longer found in the current SEC’s current approach. The unique interplay between the physical and digital world is demanded by a regulatory framework that is both clear and seemingly forward. Companies are left to guess what constitutes compliance without clear policies governing the token release, data privacy and infrastructure expansion.
This regulation of haze haze is investing and dangers that surprise the modern technology promised by Depin. Regulatory agencies should prioritize clear and transparent rules for the crypto – with some real considerations given to the Definit. If we have explicit policies in the area, depin startups are free to produce innovative infrastructure that solve critical, real world problems, rather than ignoring resources to lawyers and trial.
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Some will argue that running in an industry with minimal policies is better than a burden of so many. But history shows us that good regulation often gives way to prolonged growth, such as the skepticism of building codes to reach stunning heights while respected the history and proven by the cities they find. It is anchored and provides a solid foundation where original ideas can develop.
Where Depin’s clarity deserves
As for how to regulate a crypto vertical emerging quickly and covering many industries, from AI to telecommunication, there are three main areas where more clarity will benefit all participants.
Security compared to utility: Clear policies around the release, distribution and use of depin tokens are important. This clarity will protect investors and allow unpredictable planning and scale. Without it, the projects would be forced to testify around unclear guidelines, which submit their resources toward legal compliance rather than innovative ideas.
Data privacy: Depin platforms gather and process real-world data, from location signals to environmental information. Failure to address privacy concerns through well defined laws is at risk of a backlash of regulation and consumer loss. A forward regulatory framework should be detailed how to collect, store and monetize data, and it should balance the user’s privacy with the operations of operating these networks.
Deploying global infrastructure: There are many solutions to depin physically deploying devices or networks that cross national and regional boundaries and regime compliance. A patchwork of state, federal and international policies can stop the very essence of Depin’s global promise. Policy manufacturers should align these frameworks so that hardware deployment, spectrum use and other logistics considerations will not change uncomplicated legal labyrinth.
A better deal for everyone
While the major beneficiaries of more accurate guidelines will be depin projects, it will also help regulators – at least their public image. Receipts are public when it comes to how much the SEC has made in fines by penalty on crypto projects retrospectively. However, this has led to a mass exodo of the industry from the US. The new SEC leadership has a unique opportunity to set a precedent through reasonable crypto regulation emphasizing the penalty guide.
A long list to do is awaiting the SEC Chair, both for the crypto and the wider financial realistic market, DEPINT is not at the top of that list. However, it remains the perfect time for the SEC to show how it intends to treat modern industries such as DEPIN. This Crypto Enclave clearly defines user groups, accurate work and easily measurable results.
If the new SEC regime wants to signal the Crypto industry the treatment it can expect over the next four years, it can be worse than starting the depin.
Definition is more than another crypto trend. This is a gateway to bridging our digital and physical worlds in ways we are just beginning to think. In thoughtful, prompt regulations, the define can fulfill its immense potential: solving essential, real-world infrastructure challenges that, with accurate regulation, will not ruin the rules and improve our daily lives.
Opinion by: Kai Wawrzinek, co-founder of the impossible cloud network.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
