Crypto Regulations are coming…


19 Oct 2020
Crypto Regulations are coming…

Understanding crypto regulation is an integral step in learning about the blockchain industry. On our Nextrope blog, we decode the existing ecosystem of regulation, recent regulatory changes and barriers against new regulation.

The Status-Quo of Crypto Regulation

Cryptocurrency’s decentralized nature has prevented governments from exercising universal control and regulations. This barrier prompted varying approaches to crypto regulation across countries.

Source: Visual Capitalist

1) Extremely Tight Regulation

Countries such as Algeria, Bolivia, Morocco, Nepal, Pakistan, and Vietnam have completely prohibited cryptocurrency. 

2) Tight Regulation

Qatar and Bahrain permit cryptocurrency-related activities strictly outside the borders. 

3) Slightly Tight Regulation

Instead of directly outlawing crypto-related activities, Bangladesh, Iran, Thailand, Lithuania, Lesotho, China, and Colombia have barred their financial institutions from executing crypto-related transactions.

4) Medium Regulation 

Australia, Canada, and the Isle of Man have amended their counterterrorism and money laundering laws to regulate cryptocurrency markets and mandate  due diligence requirements on their financial institutions.

5) Slightly Weak Regulation

Spain, Belarus, the Cayman Islands, and Luxembourg are establishing crypto-friendly regulations with the goal of attracting tech investments. 

6) Weak Regulation

Belgium, South Africa, and the United Kingdom have determined the current cryptocurrency market to be inconsequentially small and are yet to establish any regulations. 

7) Extremely Weak Regulation

France, Marshall Islands, Venezuela, the Eastern Caribbean Central Bank (ECCB) member states and Lithuania are in efforts of establishing their own cryptocurrency systems. 

Why is Regulation Necessary?

Wei Zhou, the chief financial officer of the cryptocurrency exchange, Binance, spoke out in support of the cryptoregulation. Experts such as Zhou recognize that the human elements of cryptocurrency makes the system vulnerable to fraud, money laundering, terrorism and organized crime. 

Despite some users’ concerns regarding the potential negative effects of crypto regulations on its trading values and innovation, major crypto regulations have empirically never posed a long-term impact on the share price of Bitcoin, save for some immediate volatility. Further, crypto users widely believe that regulations provide the much needed investor protections that offsets its potential drawbacks. 

Source: Finance Magnates

Recent Regulatory Actions 

European Union (EU) – Proposal for a Regulation on Markets in Crypto-assets (MiCa)

On September 24, 2020, the EU Commission enacted the regulations on Markets in Crypto-assets (MiCa). MiCa’s goals are (1) reducing the rate of cash payment, which currently make up 78% of all payments in the eurozone, and (2) stimulating responsible innovation and competition among financial services providers in the EU. 

MiCA plans to differentiate between crypto-assets governed by EU legislation from crypto-assets that fall outside its scope. Prof. Rasa Karpandza, a professor of Economics and Finance at New York University Abu Dhabi and EBS Business School, claimed that “In order to achieve widespread usage as an alternative to fiat options, blockchain and crypto assets need to be classified appropriately and this is a good first step”.

In order to harmonize the EU market and prevent market regulatory fragmentation, the EU Commission published a single set of immediately applicable rules for the EU's Single Market as opposed to a "Directive", which leaves Member State discretion through the need of national transposition. I believe that MiCA will effectively bring together the fragmented national crypto-asset legal regimes within the EU.

United States (US) – Stablecoin guidance

On September 21, 2020,the Securities and Exchange Commission (SEC) published stablecoin guidance, laying out the legal implications of  cryptocurrencies backed by fiat currencies for the first time. Stablecoin (cryptocurrencies designed to minimize volatility of price and usually backed by fiat money) issuers have been using U.S. banks for years but in an unclear regulatory environment. Through the new guidance, the SEC plans to better ensure safety for the federally regulated banks as they provide services to stablecoin issuers.

Venezuela – Decentralized Exchange

On October 2,2020, the National Superintendency of Securities of Venezuela (Sunaval) authorized the operation of a decentralized electronic exchange. This legalized the exchange of shares, fiat money, securities, debt securities and cryptocurrencies. Sunaval plans to decrease the commissions to nearly 0% in order to encourage its use.

Israel – Treatment of cryptocurrency as Fiat

On September 22, 2020, the Israeli legislature proposed the amendment of existing tax law. While the current income tax policy taxes digital currencies 25% anytime it is converted into fiat, the new legislation seeks to (1) have digital currencies be treated like fiat for tax purposes and (2) exempt gain taxes on digital currencies.

Malaysia – Approval of Cryptocurrency exchange

On January 15, 2019, Malaysia passed “The Capital Markets and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019”. Designed to regulate DAX operators, the Order was followed by the legalization of a cryptocurrency exchange agency’s operation. 

Nigeria – Beginning of regulatory conversation

Source: Google Trends, Regions with highest bitcoin searches

Bitcoin has become increasingly popular in Nigeria (highest google searches in the World) and the Nigerian SEC is working to recognize cryptocurrencies as financial securities and establishing safety regulations. The Nigerian SEC claimed that “the general objective of regulation is not to hinder technology or stifle innovation, but to create standards that encourage ethical practices”,  advocating that this will protect investors’ interests and promote transparency. 

South Korea – Permit System for Crypto Exchanges

On March 5, 2020, South Korea’s National Assembly passed a revised bill on the reporting and the use of special financial transaction information. The bill introduces a permit system for cryptocurrency exchanges as well as the plans to strengthen the Anti-Money Laundering (AML) system for virtual assets including cryptocurrency.

China – Digital Yuan

China has been working vigorously on the digital yuan, though cryptocurrency is formally banned in the country. Digital yuan targets the dominance of tech giants, such as Alibaba and Tencent, in the digital payments sector. However, the government remains cautious in its approach to both its own cryptocurrency and digital assets and is yet to issue regulations.

Barriers against Regulations?

1) Economic Strategy

Because some governments believe that crypto regulation will impede growth and innovation, they intentionally avoid implementing regulations as an economic strategy. These governments also believe that while high barriers to entry through stricter regulation can benefit users by providing security, it may also curtail potential projects through financial and regulatory strains.

2) Incomplete Understanding of Cryptomarket

Current understanding of cryptocurrency, of users, economists and policymakers, remains incomplete, partly due to the volatility of the crypto market and its small size. Thus, governments are hesitant to implement hasty regulations.

3) Threat to National Economic Sovereignty

Countries, specifically the developing nations, believe that cryptocurrency will be harmful to their economic sovereignty. Decentralized finance has the potential to disrupt the financial services sector. 


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What is Account Abstraction?


10 Nov 2023
What is Account Abstraction?

Account abstraction is a new way of thinking about how users interact with blockchains. Instead of using traditional externally owned accounts (EOAs), account abstraction allows users to create and manage their accounts using smart contracts. This has a number of potential benefits, including improved security, enhanced privacy, and increased flexibility.

What is account abstraction?

Account abstraction is a concept that, at its core, aims to simplify the user's interaction with blockchain networks. It is a transformative approach that seeks to mask the technicalities of blockchain operations from end-users. It is making transactions as straightforward as sending an email. Account Abstr. allows users to interact with the blockchain without worrying about the underlying technical details.

How does account abstraction differ from the traditional model?

In the traditional account model, each user has an EOA. EOAs are controlled by private keys, which must be kept secret in order to protect the user's funds. Acc. abstraction allows users to create and manage their accounts using smart contracts.

Historical Context

The journey towards acc. abstraction began with the first generation of blockchain technologies, characterized by their "one-size-fits-all" approach to account management. Bitcoin, for instance, introduced the concept of accounts and transactions in a form that was accessible to tech-savvy individuals but remained perplexing to the layperson. Ethereum expanded on this by introducing smart contracts, which opened the door to programmable transactions but did not alter the fundamental account structure. The idea of acc. abstraction has been discussed in the Ethereum community for several years as a part of various Ethereum Improvement Proposals (EIPs), particularly as a feature to be potentially implemented in Ethereum 2.0. It is a direct response to the need for a more versatile and user-centric design that can cater to a broader audience and spur the widespread adoption of blockchain technology.

The Technicalities of Account Abstraction

Account abstraction is not merely a theoretical construct but a technical innovation with specific mechanisms underpinning its operation. In essence, it alters the way transactions are initiated and executed within a blockchain network.

How Account Abstraction Works

Under traditional blockchain models, initiating a transaction involves an externally owned account (EOA) signing a transaction with a private key. This transaction is then broadcast to the network for validation and inclusion in the blockchain. Account abstraction, however, replaces this process with a more flexible one. Here, every account is a smart contract, and transactions are messages sent through these contracts. These smart contracts can encode complex rules for transaction validation, beyond what EOAs can do, such as multi-signature requirements or conditional transactions based on certain triggers.

The technical crux of account abstraction lies in the smart contract’s ability to define its own conditions for transaction execution. This means that user accounts can have unique security protocols or automated operations without the user needing to understand the underlying smart contract code.

Hey! Are you interested in the latest technologies in the blockchain area? be sure to read the article 'Top Zero-Knowledge Proof Projects to watch in 2023'

The Benefits of Account Abstraction

The implications of account abstraction are profound, offering a range of benefits that can enhance the blockchain experience for users and developers alike.

Improved User Experience

One of the most significant advantages of account abstraction is the improvement it brings to user experience. By abstracting away the complexities of key management and transaction rules, it presents a more intuitive interface for users.

Enhanced Security Features

Account abstraction also allows for the implementation of advanced security measures. Since each account can define its own logic, users can tailor their security settings to their specific needs. For instance, one might set up an account that requires additional verification for transactions exceeding a certain value or restricts withdrawals to certain addresses.

Future Implications

The future implications of account abstraction are vast. As the technology matures, it could become a standard feature of blockchain networks, potentially making the current distinction between user accounts and smart contracts obsolete. This could lead to a new wave of blockchain applications that are both powerful and accessible, bringing us closer to the vision of blockchain technology as a seamless part of everyday life.

Challenges and Considerations

Technical Limitations

One of the primary technical challenges of Acc. abstraction lies in its integration with existing blockchain protocols. Current networks are optimized for the EOA model, and introducing a new account structure necessitates significant changes to the core protocol. This includes modifications to the way transactions are propagated in the network, how gas fees are calculated, and how the state of the blockchain is managed. Ensuring that these changes do not compromise the network's performance or security requires careful planning and extensive testing.

Compatibility with Current Systems

Another consideration is the compatibility of account abstr. with the vast ecosystem of existing blockchain applications and services. Wallets, exchanges, and other services have been built around the traditional account model. Transitioning to an acc. abstraction model will require these services to update their infrastructure, which may be a complex and resource-intensive process. Furthermore, there is a need for standardization across the industry to ensure that different implementations of account abstr. can work seamlessly together.


Acc. abstraction represents a significant leap forward in the quest for a more user-friendly blockchain experience. By streamlining the transaction process and offering enhanced security features, acc abstraction has the potential to make blockchain technology more accessible to a broader audience. However, the path to widespread adoption is not without its obstacles. Technical challenges and compatibility issues must be carefully navigated to integrate it into the existing blockchain landscape.

Key Takeaways

How to Add Gnosis Chain to MetaMask: A Simple Tutorial


03 Nov 2023
How to Add Gnosis Chain to MetaMask: A Simple Tutorial

As the cryptocurrency ecosystem expands, there is an increasing need for various blockchains with distinct capabilities. Gnosis Chain enters the scene, offering a selection of unique characteristics. By integrating Gnosis Chain with MetaMask, users can access a more comprehensive array of decentralized services. We will walk you through the steps to add Gnosis Chain to your MetaMask wallet in this tutorial.


Setting up MetaMask

Before exploring the integration of Gnosis Chain, it is crucial to have MetaMask installed and operational:

  • Download and Install: If you have not done so already, visit the official website to download and install the MetaMask browser extension.
  • Setup Account: After completing the installation, create your account and make sure to remember the provided seed phrase. This phrase serves as your primary means for account recovery, so keep it secure.
  • Secure Your Account: Protecting your MetaMask account is of utmost importance. Use a robust password and never disclose your seed phrase to anyone.

Gnosis Chain

It is always helpful to have a basic understanding before incorporating any new blockchain into your wallet:

  • Gnosis Chain Overview: Gnosis Chain, a rising star in the blockchain world, brings a range of decentralized solutions to the table, such as prediction markets and decentralized trading platforms.
  • Benefits & Features: Among Gnosis Chain's main selling points are its accelerated transaction speeds and potentially lower fees when compared to congested networks.

Tutorial: How to Add Gnosis Chain to MetaMask

In the top right-hand corner of your browser, you'll find the wallet. If pinned, click on the MetaMask fox icon; if not, click the three dots in the top-right corner. The following screen will appear:

An option to expand the wallet to a new browser page is available by clicking "Expand view:"

This action will launch MetaMask in a new tab:

By clicking on the ‘Ethereum mainnet’ in the top left corner, you can add another network. Click ‘Add Network’

Choose option ‘Add a network manually’

Then, input the information below:

Network Name: Gnosis Chain formerly xDai


ChainID: 100

Symbol: XDAI

Block Explorer URL:

After saving the settings, Gnosis Chain will be added to your network.

The Benefits of Adding Gnosis Chain to MetaMask

With multiple blockchains becoming more common, integrating Gnosis Chain with MetaMask offers numerous advantages:

Expanded Capabilities: Accessing Gnosis Chain through MetaMask opens up a collection of exclusive applications and features inherent to this particular blockchain, which may include unique dapps or cutting-edge financial products.

Diversification: The crypto domain is extensive and constantly growing. By incorporating various chains like Gnosis into MetaMask, you broaden your potential investment opportunities and decentralized application experiences, ensuring no opportunities are missed.

Speed & Cost-Effectiveness: Network congestion and high gas fees on established platforms like Ethereum can discourage many users. Gnosis Chain's architecture has the potential to provide relief through quicker transaction times and more affordable fees.

In summary, as the possibilities within the crypto sphere continue to evolve, tools like MetaMask grant users access to this expanding world. By adding chains like Gnosis, users can stay ahead in this decentralized revolution.


By bridging platforms like Gnosis Chain with accessible tools like MetaMask, individuals not only amplify their engagement with decentralized applications but also fortify their position in this expansive realm. The integration of Gnosis Chain to MetaMask epitomizes the evolution of the crypto landscape – a testament to its ever-growing diversity and potential. As we continue to delve deeper into the decentralized future, tools and integrations like these will undoubtedly play a pivotal role in shaping our digital experiences and opportunities. Whether you're seeking more efficient transactions, diverse dapp interactions, or simply a broader understanding of the crypto ecosystem, this guide's steps open doors to a new horizon.