European Union Commissioner for Financial Services Mairead McGuinness has called for a “global agreement on cryptocurrencies” to protect investors and limit the environmental impact of mining.
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The European Commissioner calls blockchain technology a positive development, as it eliminates the need for centralized processes and intermediaries, which makes transactions more efficient and transparent. But McGuinness also sees a threat in cryptocurrencies and believes that it, too, needs to be regulated.
“We should not underestimate the significant risks that cryptocurrencies pose. We don’t have to look too far into the past to see the harm that financial innovation can do without proper regulation and oversight.”
Mairead McGuinness, European Commissioner for Financial Services
The official believes that an unregulated cryptocurrency brings more risks for consumers, who can buy inappropriate products without complete information. Investors are also at risk of losing money due to scams, scams, or simply the volatility that has characterized crypto markets since their inception.
Another reason for the regulation of cryptocurrencies, the official called the possibility of circumventing sanctions and money laundering. The EU believes that sanctions against Russia for invading Ukraine should also apply to cryptocurrency. The EU cannot ignore the high energy consumption and the impact of cryptocurrencies on the environment.
McGuinness stated that the EU is one of the first major jurisdictions to offer comprehensive regulation of cryptoassets by proposing the Markets for Crypto Assets (MiCA) initiative, “promoting responsible innovation, providing legal certainty and addressing risks to financial stability, consumers and market integrity.”
The European Central Bank began evaluating the idea of a digital euro in July 2021, the European Commissioner is ready to propose the necessary legislation. But this requires global coordination and common international principles, McGuinness said.
“I call on the international community to accelerate the work done by the G20 Financial Stability Board and industry standardisers and move towards harmonizing a global approach to crypto assets. The meeting of G20 finance ministers and central bankers is the first step.”
McGuinness
In the EU, they believe that no product should be unregulated, therefore they are developing antitrust rules for technology giants and for content control .
