DThe cryptocurrency world is worried as the largely ruleless happy existence is coming to an end. Politicians and regulators are working on new paragraphs and regulations. At the same time, cryptocurrency fans are outraged by some of the planned state interventions. And try to fend off unwanted periods.
The world is not completely deregulated so far, a few paragraphs ago. In Germany, for example, companies need a crypto custody license if they offer their customers Bitcoin, Ether and Co. Just this week, Commerzbank was the first major bank in Germany to submit a asks the Bafin. Additionally, the EU Money Laundering Directive stipulates that crypto exchanges must verify the identity of their own customers. But the rules are full of holes, mainly because they often only apply to individual countries.
Uniform rules in the EU
Now the tide is turning. Until there is a common global regulation, money laundering and illegal financing of terrorism cannot be completely stopped, Indian Finance Minister Nirmala Sitharaman warned during a conversation at the conference of the International Monetary Fund this week. However, it is difficult globally for all countries to agree on common regulations.
This is why uniform standards should soon prevail, at least within the European Union. He wants to present a set of uniform rules in the coming months. The goal is to create a legal framework for crypto assets. To do this, it seeks answers to questions such as: What requirements must a company meet to offer crypto products? What is the best way to protect investors? What rights do they have if their Bitcoin is stolen in a hacker attack? Who is responsible for supervision – the German Federal Financial Supervisory Authority or the European Securities and Markets Commission? These rules are not just about Bitcoin, they are about thousands of other crypto assets.
The EU project revolves around two initiatives: first, there is the so-called “Markets in Crypto-Assets Regulation” initiative, or MiCA for short. Secondly, another initiative aims to ensure better control of cryptocurrency transactions and thus prevent money laundering. Politicians drafted the new rules in the Economics Committee of the European Parliament. The final stage of the legislative process is now pending. The rules are expected to come into force next year.
One suggestion generated a lot of discussion. These are those accounts, also called wallets, that exist outside of official crypto exchanges. There you don’t have to register with your name, you just get some sort of ID number. This makes it very difficult to understand who is behind a transfer. And that bothers many regulators and supervisors. Ultimately, this makes it more difficult to uncover criminal activity.
Crypto Fans Protest
Many crypto fans are opposed to this planned regulation. For them, this contradicts the basic idea of Bitcoin and Co. After all, cryptocurrencies should enable a decentralized financial system in which no authority or large institution knows to whom and where it sends its money. They also fear that this rule will scare away crypto exchanges and start-ups. They accuse politicians who vote for the ban of not fully understanding the consequences.