European Banking Authority calls for pan-EU rules on crypto assets

 

The European Commission has its work cut out after an official report concluded that the patchwork of different rules across the European Union covering crypto-assets could be exploited, and consumers could be failed by a lack of regulations. A year-long study into member states’ treatment of crypto-assets prompted the European Banking Authority to urge the commission, which drafts EU legislation, to undertake a detailed examination of whether it is feasible to draw up new pan-EU rules that would cover the burgeoning sector. The EBA, which ensures banking regulation is implemented equally across the EU, said the commission was best placed to undertake a cost-benefit analysis about extending regulation because it needed to look beyond the banking sector. “Typically crypto-assets fall outside the scope of EU financial services regulation,” the EBA report reads. “Moreover, divergent approaches to the regulation of these activities are emerging across the EU. These factors give rise to potential issues, including regarding consumer protection, operational resilience, and the level playing field.” The EBA call-to-action follows the global money-laundering watchdog’s concerns that criminals are exploiting the weakest link in a mish-mash of rules around the world that deal with crypto-assets, which include bitcoin and other virtual currencies based on blockchain technology.