The past week has not been too kind to cryptocurrency traders owing to the losses and a string of bad news that they had to deal with. However, there is some great news for the crypto traders especially the ones who live in Europe.
According to a Bloomberg report, the European Union’s officials have said that they are not in a hurry to regulate the cryptocurrency market. This news came in the wake of a gathering of finance ministers from the European Union’s member countries in Vienna. During the gathering, the ministers agreed that they will not rush with any further steps to regulate the market and they will instead wait for the outcome of a thorough analysis by European authorities before they finally decide on any more regulatory steps for the nascent crypto industry.
In addition to the decision by the ministers to hold off on any more regulatory moves, they also sided with the view of the Financial Stability Board that crypto assets are currently not a threat to the financial system. This move, though welcomed by many stakeholders in the crypto industry, was rather unexpected since there has been a lot of speculation regarding the European Union joining other authorities that have reined in on the crypto market.
A number of regulators in several different parts of the globe including China, the U.S. and India have been cracking down on crypto albeit with different intensities and at different levels. The European Union has only moved to increase transparency in the market – which is a good thing – but they are yet to introduce rules to protect investors and traditional financial institutions from the risks associated with the crypto market, and from the looks of it, this is not happening any time soon.
The finance ministers’ response was in response to a report from a Brussels-based think tank that called for a unified legislation on cryptocurrencies and more scrutiny on how they are distributed to investors. Bruegel, the think tank, argued for the regulation of cryptocurrency exchanges as well as clearer rules on ICOs – this, according to the report, would help in controlling risks while at the same time allowing them to exploit the potential of the cryptocurrency and its underlying blockchain technology.
European Union authorities have been avoiding comprehensive crypto regulations because of the relatively small size and nascent nature of the sector but they have been quite keen on the market’s volatility and risks such as money laundering and fraud.
The finance ministers’ gathering in Vienna was meant to ensure that everyone understands the challenge and ensure that the policymakers were “put in a position in which they’re able to act” as stated by Olaf Scholz, the German Finance Minister.
“It’s obvious that we shouldn’t wait too long with that,” Olaf Scholz added.