Two noteworthy European regulators have independently called for cryptocurrency and ICO rules at the EU level.
At first, the European Banking Authority (EBA), an administrative office of the EU, has requested the European Commission to analyze whether unified crypto rules are required for the region.
In a report published, the EBA said that crypto asset related actions don’t fall under existing EU monetary laws and, as these actions are significantly risky, proper regulations and set of rules should be set up to secure financial investors.
The EBA has, accordingly, requested that the commission complete an “extensive” investigation to figure out what activity might be required at the EU level.
Adam Farkas, the EBA’s official chief, said in an announcement:
“The EBA has notified customers and institutions on virtual currencies stay legal. The EBA approaches the European Commission to survey whether the regulatory action is required to accomplish an EU perspective on crypto-assets. The EBA keeps on observing business sector development from a prudential and customer viewpoint.”
The EBA has also requested the commission to consider the suggestions issued by the Financial Action Task Force (FATF), which will be released in June this year.
The FATF is relied upon to issue guidance for global cryptocurrency regulations including crypto exchanges, digital wallet service providers and ICOs.
The EBA has said it will find a way to screen the crypto segment throughout the year 2019. It will be building up a common monitoring framework for crypto activities, crypto related businesses and their advertisements and many more.
Meanwhile, the European Securities and Markets Authority (ESMA), has published details regarding crypto assets and ICOs.
It recommends the EU’s Commission, Council and Parliament on the current regulations and set of rules that could be implemented on crypto assets and further sets out any regulatory loopholes to consider for policymakers.
It says that some crypto assets could fall under the EU’s MiFID monetary structure and be classed as financial instruments. However, a few changes might be required in them.
Steven Maijoor, Chair of ESMA, stated that:
The survey of NCAs disclosed that some crypto-assets could qualify as MiFID monetary instruments; in this case, they will have to adopt the EU financial regulations.
But, considering that the existing set of regulations were not drafted keeping in mind these instruments, NCAs is finding difficulties in decrypting the current requirements and certain requisites are not adapted to the present crypto-assets.
Another classification of cryptos would not fall under MiFID but would have to adopt the anti-money laundering set of rules.
Plus, risk exposure ought to be implemented, to alert customers of potential dangers when putting resources into crypto assets, it said.
To have an equal field and to assure investors of security and protection across the European Union, The EU authorities pay attention to the loopholes and issues and address them at European level, Maijoor stated.