The Association for Financial Markets in Europe (AFME) has recently talked about crypto regulation in Europe. According to the institution, the European Union (EU) has the potential to become one of the leaders of the crypto market. However, this will only happen if the region is successful in regulating the sector effectively.
AFME has also given five recommendations for European leaders so they could achieve this goal. The main one is that they should establish a classification scheme for assets that can help in the introduction of crypto to the financial world.
This echoes the argument of Bankenverband, a banking association from Germany, which affirmed that it is the lack of clarity of how cryptos will be regulated that makes them undesirable for the market.
AFME’s managing director and head of technology, James Kemp, stated,
“There has been a rapid rise in the development of crypto-assets […] however, to realise those benefits, it is increasingly important that crypto-asset regulation is coordinated at the regional and global level to foster innovation, while promoting financial stability and ensuring a level playing field.”
James Kemp, the managing director of the AFME, claimed that the crypto assets have been on the rise lately, so it is important to understand their benefits and to coordinate innovation at the local level, promoting stability and ensuring that Europe has a leading position in the industry globally.
He also affirmed that the union should have clear expectations about crypto assets and that regulatory frameworks for the industry should be a top priority.
It is expected that the EU will come up with new legislation regarding cryptos in 2020, including money laundering rules and possibly take some steps forward in clarifying the regulation of these digital tokens. The main doubt is whether the EU will do it quick enough not to lose its place to Asia, which has been proving to be very strong in the market so far.