Europe to soon Experience Historic Cryptocurrencies Regulation Changes
Back In March, the National Assembly adopted a framework for the regulation and legalization of cryptocurrencies and exchanges, which will provide a legal basis for their use by financial institutions and service providers.
The EU has also signed the 4AMLD (4 AML Regulation) of the European Financial Stabilisation Mechanism (ESM), bringing cryptocurrencies or crypto service providers under regulatory control for the first time. Cryptocurrencies and cryptocurrency exchanges are considered obligatory entities and are subject to the same CFT and AML rules as for financial institutions under 4 AMLDs, as well as other regulatory requirements.
This is the result of the proposed regulation of cryptocurrencies and blockchain (RBC) in Europe by the European Central Bank (ECB). This would create an optimal legal environment for crypto firms to build their businesses and give an additional boost to the European economy, the report states.
The Commission has been advising experts for the past year. It has defined cryptocurrencies as an asset class within the framework of the European Economic and Monetary Convention (ECEA) and the International Monetary Fund (IMF). These things include the recognition of financial instruments and the creation of a framework for blockchain-based technology platforms. It points out that these “financial instruments” are placed as asset classes under extensive European and national legal instruments that regulate a region of trillions of dollars in financial markets.
Schneider and Le Saout said that the new legislation provides the necessary legal certainty for assets not covered by existing EU financial services rules. The bill also includes a proposal to create a single market for cryptocurrencies to be sold in all European countries. This is the first such legislation in Europe since the introduction of the euro in 1999, which created a single currency for all EU members. He called the upcoming bill “historic” because it opens up enormous opportunities for businesses and entrepreneurs to develop digital financial applications.
The legislation comes after Commission Vice-President Valdis Dombrovskis said that the lack of legal certainty around cryptocurrencies was hampering the growth of business opportunities in the region. The agreement on cryptocurrencies would cover all EU member states and the European Central Bank (ECB), the report said.
Still, the current proposal is due to be presented in the third quarter of this year. However, delays are expected due to the ongoing coronavirus pandemic, the report said.
