With all the chaos in Europe over the past few weeks, you may have been forgiven for forgetting that the EU Parliament was voting on banning cryptocurrency this week.
Given the far ranging implications such a ban would result in, the motion to do so naturally failed, but cryptocurrency remains in the crosshairs of the EU, with its effects on the environment and lack of regulation being the two sticking points at the moment.
“On Monday evening, the Economic and Monetary Affairs Committee adopted, with 31 votes to 4 and 23 abstentions, its negotiating position on new rules on crypto-assets. They aim to boost users’ confidence and support the development of digital services and alternative payment instruments,” the EU explained in a press release.
Honing in on the regulatory elements, it appears as if much of the focus is on the distinct lack of transparency for the general public when it comes to crypto.
“Key provisions agreed by MEPs for those issuing and trading crypto-assets (including asset-referenced tokens and e-money tokens) cover transparency, disclosure, authorisation and supervision of transactions,” the release noted.
“Consumers would be better informed about risks, costs and charges. In addition, the legal framework supports market integrity and financial stability by regulating public offers of crypto-assets. Finally, the agreed text includes measures against market manipulation and to prevent money laundering, terrorist financing and other criminal activities,” it added.
Given the sheer volume of pump-and-dump scams of late, it is easy to see why greater transparency and regulation is needed on this front.
As for the environmental concerns, the EU is taking a similar stance to China, although is not moving as swiftly with its enforced changes, with a little under three years being given by the Parliament.
“To reduce the high carbon footprint of crypto-currencies, particularly of the mechanisms used to validate transactions, MEPs ask the Commission to present MEPs with a legislative proposal to include in the EU taxonomy (a classification system) for sustainable activities any crypto-asset mining activities that contribute substantially to climate change, by 1 January 2025,” it laid out.
“The regulation being created is pioneering in terms of innovation, consumer protection, legal certainty and the establishment of reliable supervisory structures in the field of crypto-assets,” added lead MEP, Stefan Berger.
With more eyes than ever on the cryptocurrency industry, it looks like governments the world over are wanting to have their say on digital assets.
[Image – Photo by Guillaume Périgois on Unsplash]
