Countries globally called for a clear regulatory framework in 2020 to stop the blockchain platform from being used for illegal activities. While some countries created rules to promote the blockchain platform, others created legislation to wipe out the industry entirely. Some countries like America proposed creating rules that prevent illegal activities while still fostering the blockchain industry’s growth.
India’s parliamentary mandated cryptocurrency providers to stop their various activities in the Asian country. A French regulator, who sees the importance of promoting and supporting the blockchain industry opined that the country needs some changes in its crypto-asset regulation that does not impede the blockchain industry’s growth. Interestingly, France was one of the world powers that saw the need to lay a regulatory framework for the growing sector.
AMF head suggests ESMA head new regulations
Robert Ophèle, head of Autorité de Marchés Financiers, is the regulator calling for better regulation for the crypto industry. He said people’s interests in getting cryptocurrencies created challenges for regulators, looking into creating regulations for the industry and suggests them taking another approach regarding the laws.
While suggesting a new approach, the chairman recommended ESMA to make the new rules while regulating crypto providers’ activities in the country. Ophèle opined that the body’s appointment as the sector’s watchdog would ensure a level playing field in the European Union.
The regulator also explained that another reason why ESMA should be given the authority to take on the role is that the regulation is a new creation and would be easy for the body to take the responsibility from its early stage to understand it better.
Ophèle added that getting one body to handle the sector would be easier, primarily thinking about the industry’s costs. The head referred to the EU’s regulations for cryptocurrencies and stablecoins while adding that the legislation closes some loopholes. Nevertheless, getting an appropriate regulation for the instrument would help the financial markets prepare for the future.
What the pilot regime is about
The pilot regime would have specific regulations to cover up even the tiniest parts of the sector. The term encompasses Blockchain market infrastructure for interested companies who want to explore cryptocurrencies for transactions and trades, and the authority helps better supervision of companies using the crypto instruments. He suggested convenient regulations for the crypto industry, such as a sandbox, asides from the pilot regime.
The regulator opines that the current digital asset regulations approach could impede the industry’s growth with stringent legislation. The country proposed a regulatory framework that is only appropriate for centralized financial systems, which would violate blockchain’s decentralized elements. He added that the regime could help the industry get laws that won’t prevent its daily running, especially when authorities request requirements appropriate only for centralized systems.
The European Union took some steps last year to facilitate some regulations in the cryptocurrency industry due to the call on digital finance regulations. Fortunately, the pilot regime and sandbox approach could be what the authority needs to make relevant regulations for the booming industry.
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