EU Asks Its Citizens For Help in Creating Crypto Regulation 101Source: iStock/AlexSava

The European Commission (EC), the executive body of the European Union (EU), has launched a public consultation on the regulation of cryptoassets, as the world’s second largest economy aims to strengthen its positions in the global payments market.

The EC invites investors, banks, supervisors, consumers and other stakeholders to share their views on how the financial sector could benefit from digitalisation in a safe manner, according to Commission Executive Vice-President Valdis Dombrovskis.

“We also want to be open to financial innovation, so that the EU builds scale and can compete globally in the payments market. That means we need to develop a common approach on cryptoassets, while addressing risks in a proportionate way,” he said.

The EC says that “crypto assets have the potential to bring significant benefits to both market participants and consumers,” including more efficient ways to finance small and medium-sized companies via token sales.

“If the adequate investor protection measures are in place, cryptoassets could also represent a new asset class for EU citizens. Payment tokens could also present opportunities in terms of cheaper, faster and more efficient payments, by limiting the number of intermediaries,” they added.

Additionally, the Commission wants to consult on improving regulation that would help the financial sector to deal with cyber attacks and other risks.

According to the EC, these consultations provide a first step in the process of shaping key elements of a broader strategy to promote digital finance in Europe. They claim that the feedback from the public consultations will feed into the Commission’s impact assessment on possible upcoming initiatives. The consultation will remain open until 18 March 2020, while the Commission may consult further on other issues in this area in the coming months.

Now, the EC is asking more general questions aimed at gaining feedback on the use or potential use of cryptoassets. Also, they want to hear from stakeholders on whether and how to classify cryptoassets, and seeks views on cryptoassets that currently fall outside/withing the scope of the EU legislation.

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Below are several examples of their questions:

  • Have you ever held cryptoassets?
  • Do you plan or expect to hold cryptoassets in the future?
  • Do you agree that the scope of this initiative should be limited to cryptoassets (and not be extended to digital assets in general)?
  • What are the most important benefits related to cryptoassets?
  • What are the most important risks related to cryptoassets?
  • What are the most important risks related to “stablecoins”?

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