EU Financial Services Chief Hints at Broad Cryptoasset Regulation
During a parliamentary confirmation hearing, the European Commissioner for Financial Stability and Financial Services, Valdis Dombrovskis, said that the E.U. is planning to regulate cryptoassets following the unanticipated wake-up call from Libra. Bloomberg reports that Libra has shocked global regulators into action, and the E.U. is determined not to be left behind, October 8, 2019.
Regulators Finally Open Their Eyes
Regulation is coming to cryptoassets in Europe as it has finally been confirmed that multiple agencies in the region are working on a framework for the treatment of virtual currencies and cryptoassets.
While the organization has not said anything particularly negative, Dombrovskis believes that these currencies must be evaluated based on their risk to financial stability, monetary stability, data protection, and the ability to thwart money laundering.
Nearly one week ago, the European Commission sent Facebook a detailed questionnaire regarding their plans for Libra. The Libra Association and Facebook have yet to reply to the request.
France and Germany have vehemently opposed Libra, even though the European Commission seems to be fairly open-minded. Germany went as for as vowing to stop Libra from entering the bloc, so this creates a fairly confusing situation.
The primary fear with Libra is that regulators believe it will cause “financial instability”. What this really means is that Facebook has the firepower and resources to establish a private currency that can compete with traditional money.
Libra as a Driver of Fear
Libra is now acting as a catalyst for global regulation of cryptoassets as well as an awareness generator. By dominating headlines in mainstream newspapers, the advent of cryptoassets is being projected to the masses.
With Libra now at the forefront, people who have in crypto thus far are finally awakening to the real value proposition of Bitcoin. While “number go up” is fun rhetoric to watch, it is becoming abundantly clear that the censorship-resistant nature of Bitcoin is its most valuable trait.
No regulator can shut it down or stop people from using Bitcoin.