Cryptocurrencies to Get Green Signal from European Legislation

Steve Anderrson
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain. Join the official channel of thecoinrepublic, For the latest news updates: https://t.me/thecoinrepublic
  • Cryptocurrencies from now on will be clearly defined according to the European Legislation after it will demarcate its role and functioning across Europe
  • The new law would include legal clarity that is required for both crypto-assets not protected by current EU financial services regulations and the application of DLT in financial services and other conventional financial instruments
  • The European Union Commission had initially planned to adopt it from 2020 itself, but there could be delays due to Covid-19 pandemic

Cryptocurrencies from now on will be clearly defined according to the European Legislation after it will demarcate its role and functioning across Europe. Lack of legal clarity often created stumbling blocks for the establishment of a healthy crypto-asset market in Europe. However, with the new legislation, Europe could well be the trendsetter by improving its international standards in the emerging digital finance technologies space.

The new law would include legal clarity that is required for both crypto-assets not protected by current EU financial services regulations and the application of DLT in financial services and other conventional financial instruments. Which is crucial in that it places crypto-assets within a wide range of European and national legal instruments governing the EU financial market

Key Features of the Digital Finance and European legal framework

The new law would include legal clarity that which will be built around five key building blocks: scope, subject-matter and definitions, issuers’ requirements, stablecoin issuers’ requirements, crypto-asset service providers’ requirements, dedicated rules to ensure market integrity, and issuers’ supervision, along with national competent authorities’ powers to ensure market integrity.

The European Union Commission had initially planned to adopt it from 2020 itself, but there could be delays due to Covid-19 pandemic. Le Saout, chairman of the Brussels-based European Blocktech Federation was of the view that the laws will ensure a stronger digital financing system across EU as it will provide legal certainty, which is needed both for crypto-assets for the application of DLT in financial services. 

As per the current suggestions, the creation of a sandbox is suggested, which will help to understand the tokens on the blockchain. The proposed legislation will also help in understanding how blockchain-based market structures should be regulated.

Single Market for Crypto Assets

One of the key features of the legislation will be creating a single market for all the crypto-assets to ensure that they can be sold across the borders in Europe seamlessly. It further suggests that writing a regulation to establish harmony between the EU participants who seek to offer their crypto-assets across the Union and crypto-asset service providers wishing to apply for an authorisation to provide their services.

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