Bitcoin Suisse, through the words of its president, explains what will be the path taken by European regulators towards cryptocurrencies
Speaking at the microphones of CoinDesk TV is Luzius Meisser, the Chairman of Bitcoin Suisse who provides an overview of the status of the European Union’s regulations towards the cryptocurrency asset class.
The scope of laws and regulations that put roadblocks on the fascinating crypto asset was the topic that President Meisser addressed yesterday at the microphones of CoinDesk TV in the “All About Bitcoin” format.
The head of Bitcoin Suisse explained his views about the moves the European Union wants to take to regulate, restrain and secure such a young but soaring industry.
The watchwords are safety and growth, and the result will have to protect both classical finance and the crypto world.
The most likely path is to compartmentalize or almost compartmentalize.
Europe will most likely try through new laws and regulations to keep the banking and crypto sectors as separate as possible without restricting either.
What will happen according to him is the creation of a legal firewall that will make the crypto world elitist but not forbid it in any way.
Meisser believes that the path of containment is the most feasible of the hypotheses put on the table by the Swiss company in Zug.
“Their intention is to protect the traditional financial system from the toxicity of the crypto economy but perhaps it also helps to protect cryptocurrencies from the traditional financial systems with all its flaws and mistakes.”
Seven days ago, in Europe they put very strict restrictions on all those lending institutions that wanted to hold BTC to a vote.
The stipulations are equal to those outlined by the Basel Committee on Banking Supervision i.e., the main body referenced when it comes to the crypto world in the international arena.
The committee has outlined even stricter rules than those sought by the Basel Committee, and the rigidity of these will grow more and more over time from the 1% rule in effect from 2025 to the 2% rule shortly thereafter.
“It means that for every bitcoin you hold for a client, you must have one bitcoin in addition to that in Equity. It basically prohibits banking with Bitcoin, you cannot have a traditional bank account where the client only has a balance of Bitcoin.”
In essence, cryptocurrencies cannot be pledged as collateral and do not constitute a reserve.
By doing so, bank credit via cryptocurrencies is effectively impossible for banks.
The scenario where European lawmakers, including those most hostile to the crypto world, ban it in its entirety is deemed nearly impossible.
The amount of investment, the intermingling in classical finance and the user base have reached such a level that it would be impossible and counterproductive to ban its practice.
Even a superficial, leave-behind approach is not the most likely scenario since waiting for the market to limit faults on its own would be like bypassing the Union’s very function as a regulator.
Source: https://en.cryptonomist.ch/2023/01/31/bitcoin-suisse-regulation-sector/