Cryptocurrency Wild West is crying out for a principled sheriff

Bitcoin was born nine years ago as an anarchic project — a digital currency detached from any central bank. It promised a revolutionary alternative to the existing international payments system, where a central administrator was replaced by a multitude of decentralised digital verification points. But the future of bitcoin and the technology it uses, blockchain, are drifting towards the mainstream. Regulators have their sights set on bitcoin and other crypto assets it inspired. More than 75 of the world’s biggest banks, meanwhile, are turning to blockchain to fight the threat of new payments rivals.

The regulatory attention had become inevitable after bitcoin’s wild swings in value — which at its peak was yo-yoing by as much as 20 per cent in a day but has slumped from $19,000 last December to about $6,500 today. Bitcoin was followed by other types of cryptocurrency, the creation of exchanges, brokers and providers of wallets, or apps for holding and transacting in…