Chairman of the French Financial Markets Authority (AMF) Robert Ophèle said European regulators should reconsider their attitude towards DLT and blockchain.
Ofel said this at the 5th Annual Conference on Fintech and Regulation. The AMF Chairman urged financial supervisors to take a new approach to regulating blockchain-based financial instruments, as this technology is starting to be used in many areas of activity. Ophel proposed that the oversight of the cryptocurrency industry be carried out entirely by the European Securities and Markets Authority (ESMA). Given the current regulation in the European Union, it will be easier for the agency to develop guidelines “from scratch” than to finalize them at a later stage.
ESMA’s activities are aimed at ensuring the stability of the financial system, protecting investors and developing financial markets. In early 2018, ESMA stated that cryptocurrencies are highly risky assets and investors “should not invest money in them that they cannot afford to lose.” Ofel also suggested considering creating a regulatory sandbox for share token issuers. The AMF chairman is convinced that the current regulations hinder blockchain development as they are designed for centralized systems.
Ofel acknowledged that thanks to its decentralized nature, blockchain can improve the European economy. Blockchain can increase the efficiency of processes related to supply chains, increase the transparency of data exchange and speed up interaction between system participants. In addition, blockchain can mitigate the security risks that centralized infrastructures are exposed to. Ofel stressed the need to maintain the competitiveness of the European economy, as many countries are already beginning to actively introduce the latest technologies.
Last fall, an unofficial version of the European Markets for Cryptoasset Act (MiCA) appeared on the Internet, which provides general rules for virtual asset service providers (VASP). Subsequently, many digital asset firms have raised concerns about this bill. XReg Consulting believes that MiCA could overload the industry with excessive demands and hinder the development of the Decentralized Finance (DeFi) industry.
