EU regulation for cryptocurrencies: protection for investors, innovation remains!

EU regulation for cryptocurrencies: protection for investors, innovation remains!

With the increasing popularity of cryptocurrencies, the call for regulating measures in this digital sector is also growing. Investor protection is mentioned by many as the most important argument for uniform regulation. However, there are also not inconsiderable concerns about possible restrictions on the trade in Bitcoin, Ethereum and other digital assets.

An important step towards coherent regulation was reached with the agreement on the European Ordinance for Crypto values, known as Mica. The French Minister of Economics and Finance, Bruno Le Maire, emphasized the urgency of this regulation in order to better protect investors and prevent the abuse of crypto values. The Mica is also intended to ensure that Europe does not lose its competitiveness in the exciting area of digital technologies. In particular, investors of stablecoins that are bound to other assets should be strengthened by this regulation.

criteria for regulation in the cryptom market are increasingly required by experts. Matt van Buskirk, CEO of Hummingbird Regtech, underlines that regulation should be carried out without stinging innovations. He calls for a clear definition of cryptocurrencies in order not only to determine them on the basis of existing asset classes, but also to position them in a legal framework.

As the LummiS-Gillibrand Branding Act shows in the United States, solutions are also sought there in order to better integrate digital assets. Both senators have emphasized that a clear legal situation is crucial for both investors and the regulatory authorities. However, van Buskirk recognizes the challenge that these definitions must be comprehensive enough to take into account the dynamic character of the market.

Investment between regulation and innovation is a central topic in these discussions. While strict measures to protect investors make sense, it is crucial that they remain flexible enough to take into account the developments in the cryptom market. "Regulatory authorities have to ask the question of whether a regulation protects the end consumer or improves existing companies," explains van Buskirk.

A quick reaction to market developments is emphasized as a further point. The crypto crash in June 2022 showed how important it is that legislators react promptly to market events in order to preserve investors from losses. The declared goal is therefore to develop a regulatory framework that can keep up with the speed of the cryptoma market.

Overall, it is underlined that the regulation of cryptocurrencies is not only necessary, but also overdue. It is time to develop sensible regulations that guarantee the protection of investors and promote the creative potential of this new technology. Details on this topic and the latest developments are at www.finance.ch read.