On April 20, 2023, the European Parliament gave the green light to the first comprehensive rules for regulating the field of cryptocurrencies. According to the new regulation, service providers will have to protect the digital wallets of customers, and if they lose investors' crypto funds, they will have to be responsible for it. The purpose of the rules is to protect investors from abuse and manipulation.
The European Parliament has given the green light to a rule to regulate the field of cryptocurrencies
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Author: Kristina Dosen
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Content accuracy validation date:
24.04.2023
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The new rules—the European Commission first presented their draft in October 2020—refer to crypto-assets, which include cryptocurrencies such as bitcoin and ether, as well as other trading assets whose value is secured by blockchain technology, such as non-fungible tokens (NFT).
Greater control over the trading of crypto assets should be provided so that it is more in line with traditional financial practices. This should make it more difficult for criminals to exploit cryptocurrencies for money laundering.
In addition, big players in the cryptocurrency space are required to disclose data on energy consumption. The EU is working to reduce the high carbon footprint in this activity.
The European Commissioner for Financial Services, Financial Stability, and Capital Markets, Mairead McGuinness , warned during debate in Parliament that FTX, if it was already subject to the new EU rules, would not be able to carry out some of its practices, which could prevent its collapse, thereby save investors huge losses.
The new rules must be officially approved by the Council of the EU, after which they will be published in the Official Journal of the EU. They will be in force in July 2024, after they have been transposed into national legal order by EU member states. This year, the EU is also expected to present a proposal for a digital euro.
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