France’s chief financial regulator has proposed changing the way the cryptocurrency industry is monitored in Europe.
Robert Uville, chairman of Autorité des Marchés Financiers, raised the issue of crypto property regulation at the 5th annual conference on technology and financial regulations. The official argued that financial regulators should take a new approach to organizing blockchain-based financial instruments due to the explosive growth in the market.
Ofill suggested that the European Securities and Markets Authority, or ESMA, be the authority responsible for this new area of regulation and oversight. Ofel emphasized that the current regulatory phase in the European Union will make it easier for ESMA to develop guidelines and policies:
“Since this provision is completely new, it is easier to provide ESMA with expertise from the start than if it were taken up at a later time. Moreover, it would be wise to gather all the expertise in one body, since the costs of entering the crypto world are so high.
ESMA, headquartered in Paris, is an independent body of the European Union that works to ensure the stability of the Union’s financial system by strengthening investor protection and promoting stable financial markets. In early 2018, the Emirates Authority for Standardization and Metrology issued a joint warning that cryptocurrencies are extremely risky assets, warning investors against “investing money they cannot afford to lose.”
Ophel has also proposed additional rules, including a regulatory sandbox for the security token industry. The official said the current regulations hinder the development of blockchain technology because it is designed for centralized systems. Offel said the decentralized nature of the blockchain could play an important role in the European economy:
“DLT technology will reduce risk by accelerating the market chain and its distributed nature, which may reduce some of the cyber risks caused by central market infrastructures as one mistake […] It is also about maintaining competition in Europe at that time. Similar approach in many countries. ”
The European Commission published the Crypto Asset Markets or MiCA Rules in September 2020, providing a regulatory regime for cryptocurrency markets and related service providers. Major crypto firms, including ConsenSys, have raised concerns about MiCA and warned that the new rules could overwhelm the industry with costly and complex regulatory requirements.