The European Commission consults on an EU Regulatory Framework on Crypto-Assets
A Public Consultation
The European Commission has launched a public consultation on an EU regulatory framework on crypto-assets. The Commission is accepting responses from EU citizens, competent authorities, and market participants within the crypto-asset and financial services sector until the 19th of March 2020.
In order to promote the availability of digital finance in Europe, the Commission is working towards a new Digital Finance Strategy for the EU. This is largely due to digitalisation which is already transforming the financial system and the provision of financial services to Europe’s businesses and citizens.
This public consultation, along with the consultation on digital operational resilience, will lay down the groundwork for the Commission’s future initiatives on crypto-asset regulation in the EU. It will additionally allow the Commission to further promote research on how blockchain could be used across sectors. Furthermore, this will ensure regulation is in place to cover the potential risks involved.
The questionnaire consists of four main sections. In the first part, the questionnaire seeks to gather the views of EU citizens on the use of crypto-assets. The other three sections are mostly addressed to public authorities and financial/market participants within the crypto-asset sector.
The second section focuses on whether and how to classify crypto-assets. It is the intention of the Commission to comprehensively classify crypto-assets in order to decrease uncertainty in the markets. It focuses in particular on crypto-assets which fall within the scope of existing EU financial services legislation as opposed to those which do not.
The third section specifically elaborates on crypto-assets which fall outside the scope of EU legislation. The Commission is currently looking into whether a need exists for the implementation of an EU-wide regulatory framework. A legislative intervention in this regard can be expected to allow for risks in relation to such crypto-assets to be identified, mitigated, and controlled as the case may be.
The fourth section addresses crypto-assets which currently fall within the scope of existing EU legislation. Therefore, this specifically refers to crypto-assets which qualify as ‘financial instruments’ under MiFID and ‘e-money’ under EMD2. The Commission is seeking feedback to identify the possible impact should changes be enacted to the current EU legislation.
The Consultation furthermore includes a few questions in relation to anti-money laundering and countering the financing of terrorism.