A report prepared for EU finance ministers calls on the European Union to adopt standard cryptocurrency regulations across the region.
In it, Brussels-based think tank Bruegel advocates in favour of common EU crypto regulations of crypto exchanges and more transparent rules on initial coin offerings (ICOs) to control risks and exploit the potential of the industry and the underlying blockchain technology.
EU finance ministers are expected to receive the document seen by Reuters when they meet this Friday and Saturday in Vienna.
An industry too small to regulate?
The EU has avoided taking regulatory steps towards crypto due to the industry being too small in size and Bitcoin’s low trading into euros percentage. The region’s authorities are also highly concerned over the market’s volatility and the risk of fraud and money laundering.
However, ICOs account for 30% of the global market in regards to the funding of projects, a factor that is prompting regulators to think twice. Reuters notes that crypto exchange businesses in EU will increase, while there’s already a growing interest for ICOs in EU countries.
Malta and Switzerland, for example, have adopted crypto and blockchain friendly measures to attract new businesses and technologies to their countries. Binance, currently one of the world’s largest cryptocurrency exchanges, is moving to Malta shortly.
Austria has asked for new EU rules
Austria, which holds the EU presidency currently, has already touched on the topic of changing EU regulations in light of the “potential risks posed by crypto assets” and harnessing their full potential, the document for EU ministers adds.
In the report, Bruegel says Bitcoin is impossible to regulate because of its virtual nature. However, cryptocurrency exchanges can and should be held to stricter disclosure rules or be banned. It also suggests that, “as done in China, mining farms can be forbidden.”
New EU anti-money laundering rules, which would increase official supervision of crypto exchanges, are not expected anytime before 2020, Reuters concludes.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.