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ESMA Looking into Cryptos and Blockchain Tech

european union

It is no denying that cryptocurrency has been a booming market. Its technology offers a new look towards transactions and how to get rid of third parties. However, during the latter part of 2017, there was an increasing number of regulators that wanted to put a stop to the Wild West environment of the crypto market. In fact, China has continuously clamped down on crypto related activities in recent months. The same is true for other Asian countries including both India and South Korea.

And now, European Union’s top securities watchdog has mentioned cryptocurrencies as one of its top priorities by 2018. In its work agenda released last Feb 7, The European Securities and Markets Authority (ESMA) made an outline of the primary areas that they are planning to focus on for the coming year. One of which is to monitor the development of financial innovation that includes cryptocurrency and blockchain technology.

ESMA expects the rapid pace of financial innovation development across the EU securities markets to continue in 2018. These developments influence the way in which securities are developed, traded, and supervised. In turn, ESMA is undertaking material analysis on the emergence of such instruments as virtual currencies, such as platforms as ICOs and such tools as distributed ledger technology”.

This has been the very first time that the watchdog has mentioned cryptocurrency in its supervisory agenda. This only means that there will be increased scrutiny towards cryptocurrencies. And given the growth of crypto market both in Europe and other parts of the world, this isn’t surprising at this point.

Just last month, the agency has also announced that it was looking for public feedback on the possibility of applying changes on regulations regarding cryptocurrency derivative contracts. Keep in mind that central banks of European Union countries are also going to follow the same route as ESMA in 2018 towards focusing on cryptocurrencies and ICOs.

Regulators Having the Final Say?

It is quite intriguing at this point as to what Bitcoin and cryptocurrencies are going to become. Nowadays, it is clear that the policymakers do have the last say regarding the future of this digital asset. Crackdowns have started in China and South Korea banning ICOs to Japan introducing a licensing body for cryptocurrency exchanges.

Though there are still gaps when it comes to regulations regarding cryptocurrencies, mainly because it is a relatively new market, it is undeniable that these moves affected the price of different cryptocurrencies.

There were some cryptocurrencies especially last year that were having 1000’s of percent increase. And one of the reasons for this is the lack of regulations to monitor cryptocurrencies. With scams, hacking incidents, and Ponzi schemes, it is true that it was only a matter of time before cryptocurrencies are going to be regulated.

Will cryptocurrencies still spike in value like in the previous years now that bureaucrats are taking a closer look at the market? Though regulations are good in the long run as it protects investors, it dilutes the appeal of what cryptocurrencies should be.

Janneke Eriksen

Janneke is a writing ninja and has vast experience in journalism, specifically in the crypto space. As a blockchain believer and avid Bitcoin fan, she’s incredibly excited to share to our readers the latest news around so they are always updated wherever they are.

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