CEU Electronic Theses and Dissertations, 2020
| Author | Horban, Tetiana |
|---|---|
| Title | Governmental Response to Bitcoin: Why Cryptocurrency Regulation Differs Across the World |
| Summary | Currently, there is no single approach to regulating cryptocurrencies in the world. The study of factors that could explain this is underdeveloped. Limited research, though, shows that cryptocurrencies are less regulated in economies with sophisticated legislation. In contrast to existing work, which does not differentiate between the hands-off approach of governments and permissive regulation, I argue that democracies with the developed legislature are less likely to ban cryptocurrencies but, at the same time, are more likely to apply permissive regulation to them. I also assume that factors, that matter in cryptocurrency adoption, may influence how governments respond to cryptocurrencies. This thesis answers the question of why cryptocurrency regulation differs across the world by examining the relationship between governmental response to cryptocurrencies, on the one hand, and the level of democracy and factors that matter in cryptocurrency adoption, such as corruption, inflation, and dependence on remittances, on the other hand. My main method of estimation is a cross-sectional ordered logit regression using data from Polity data series, World Bank database, and Transparency International. To measure the governmental response to cryptocurrencies, I create an index of 172 economies using the information on cryptocurrency legal and regulatory status available as of 2018, thus, my research does not capture regulatory changes over time. The results confirm my hypothesis regarding democracies. However, I find no evidence that adoption-related variables influence governmental response to cryptocurrencies. This paper places cryptocurrencies into the international political economy agenda and contributes to the emerging literature on drivers of cryptocurrency regulation. |
| Supervisor | Li, Andrew X. |
| Department | International Relations MA |
| Full text | https://www.etd.ceu.edu/2020/horban_tetiana.pdf |
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