THE EU’S PROPOSED FRAMEWORK FOR A MARKET IN CRYPTO ASSETS

After years of anticipation on December 19, 2019 the European Commission (the Commission) issued a public consultation on crypto assets,  which concluded on March 19, 2020. The consultation paper follows detailed due diligence including a report on virtual currencies by the European Parliament, the setting up of the Blockchain observatory to monitor the use cases of blockchain, an audit of existing legislation from the European Securities and Markets Authority (ESMA) and the European Banking Authority (EBA), and an attempt to bring it within the remit of the European Crowdfunding Service Providers Regulation.

The all-encompassing consultation covers three main areas:

1. The classification of crypto-assets
2. The treatment of crypto-assets which are covered by EU legislation, and
3. The treatment of crypto-assets which fall outside of the scope of EU legislation.

Following extensive feedback from the industry and regulatory authorities from around the world, the Commission issued a “non-paper” in May 2020, which includes options of possible approaches that may be taken in the proposal.

Source: Forbes