EU Financial Services Commissioner urges worldwide approach to regulation on crypto

Since the Bank of England’s Jon Cunliffe warned in November of the emerging market’s looming threat to financial stability, worldwide authorities have been working separately to draft comprehensive laws for the new industry.

However, European Financial Services Commissioner Mairead McGuinness has urged a worldwide approach to regulation.

What can be regulations?

Mairead McGuinness, the EU Financial Services Commissioner, called for a worldwide consensus on crypto rules in an opinion piece published on THE HILL on Sunday.

McGuinness was convinced that for regulations to be successful, the world community needed to work together.

In the paper, the official described what such a global regulatory effort would involve “A global crypto agreement should first ensure that no product remains unregulated,” McGuinness added.

Second, supervisors should gather and share data across the globe. Third, any agreement must ensure that individual investors are protected.

Fourth, environmental factors should be fully integrated into the crypto ecosystem.” The US and the EU, according to McGuinness, are best positioned to lead this evolution.

Why regulations are needed

McGuinness is certain that the appropriate approach to global rules can stimulate innovation while still safeguarding customers and sustaining financial stability. Blockchain technology, according to a top EU official, has the potential to assist the globe in a variety of ways.

She did point out, however, that regulators could not overlook economic and environmental concerns. McGuinness emphasizes the dangers of sanction evasion, terrorism funding, and environmental concerns associated with Bitcoin mining.

Notably, the official’s advice comes as the EU is currently negotiating the TFR in Trilogue. In the region, the new AML law has been labeled an effective prohibition on unhosted wallets.

It’s the second crypto rule that the cryptocurrency industry has had to fight in recent months. The EU came close to outlawing Bitcoin in March, but the crypto sector fought back, and the bloc ultimately voted against it.

While crypto enthusiasts believe that government rules would achieve a balance between innovation and client protection, ECB executive member Fabio Panetta’s views have not been encouraging. Panetta even advocated for more taxes on the wealthy.

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