Regulation is when something is controlled by a specific set of rules.
What Does Regulated Mean?
Regulated means that a specific thing, such as an exchange, or a currency is controlled or maintained so that it operates properly. In the world of cryptocurrencies, the currency in question is only regulated if the sale constitutes the sale of a security under state or federal law, or is considered money transmission under state law or conduct. In other words, regulation means that something is controlled, by making it work in a specific way or through following pre-set rules.
In regard to cryptocurrencies, you have probably heard the term regulated market or controlled market. This means that it is a market that is essentially an idealized system where the government or other organizations oversee the market itself and control the forces in terms of supply as well as demand. They can even regulate the market actions if applicable.
That being said, this does come with its own benefits, and a variety of forms of regulation can be found in a regulated market. These include controls, oversights, environmental protection, taxation and anti-discrimination.
However, keep in mind that regulation can change over time due to the various technological advancements as well as a change in attitude towards a specific regulation in general.
This practice of regulated markets has its origin all the way back to when ancient societies relied on standardized weights as well as measurements and even practiced punishment when theft or fraud occurred — quite fascinating.
Another way we can define the market is as a multilateral system that is operated as well as managed by a market operator, and intended to bring together or facilitate the binding together of a multitude of third-party buying. This is of course alongside the process of selling interests in financial instruments. In this system, as well as in accordance with its rules, it can result in a contract and in respect of the financial instruments that were admitted to trading under its rules or systems.