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15 insights on cryptocurrency regulations in Europe

15 insights into cryptocurrency regulations in Europe. Countries and financial regulators from all over the world are trying to take cryptocurrencies.
15 insights into cryptocurrency regulations in Europe. Countries and financial regulators from all over the world are trying to take cryptocurrencies.

15 insights into cryptocurrency regulations in Europe

 

Opening remarks

2018 is citing to be one of the most reckoning years in the currency space for its regulations. The anonymity provided by the cryptocurrencies is the main characteristic feature which is blamed for the usage in all the illicit activities. Countries and financial regulators from all over the world are trying to take cryptocurrencies into under their control.

 

World take

Countries like Japan and Australia have realized crypto to be dangerous and are speculative about the money laundering schemes that have been undertaken in the name of cryptocurrencies and hence have categorized them as an asset which is basically used nothing but for Capital Tax Gains. The financial regulators from Australia were very open-minded towards cryptocurrencies and had even suggested the Reserve Bank of Australia accept cryptocurrencies in the official form.

On similar lines at the Securities And Exchange Commission from the United States have expressed their doubt and have warned investors to invest on their own risk. Many Initial Coin Offerings in the state were also truncated. Many cryptocurrency exchanges in Japan as well as the United States have been cooperating with their respective financial regulators and are compiled to provide customer personal data to the financial authorities which might create a point of conflict between customers and the exchanges.

 

Cryptocurrency regulations in Europe are quite confusing due to the differences in the opinion of the European Union and personal opinion of the independent members of the Union

  1. The cryptocurrency regulations in the European Union is a complex mixture of the European Union legislation and the national laws.
  2. The cryptocurrency market in European Union is seeking to gain some kind of maturity as the cryptocurrency exchanges from London and Austria have come forward in order to join hands with regulators for a better security for investments.
  3. In order to avoid any kind of knee-jerk reaction from the regulator, the brokers find it better to cooperate with the financial regulators in order to sustain their business.
  4. The European Union’s Fifth Anti Money Laundering Directive (5AMLD) was launched on June 19th, 2018. All the members of the European Union are directed to enforce the rules and regulations in this directive prior to 20th January 2020.
  5. The Fifth Anti Money Laundering Directive is one of the major steps in the cryptocurrency domain among the European Union members. Prior to which the cryptocurrency space was unregulated.
  6. According to 5AMLD, cryptocurrency coins, as well as tokens, have been defined in such a way, that most of the coins and tokens wouldn’t fall under its region.
  7. The Crypto to Crypto exchanges in European Union is lesser concentrated upon by the directive, which may lead to lesser regulations and hence security among them.
  8. The Crypto to Crypto exchanges offers not just exchange service but also a number of additional services such as custodian wallet, Gateway services, etc.
  9. Currently, the European Union along with the United Kingdom doesn’t seem to have a full-fledged regulation in this domain and are yet to finalize it.
  10. One of the obliged entities for Fifth Anti Money Laundering Directive is the custodian wallet providers as they effectively store the investments of people.
  11. The cryptocurrency exchange platforms, as well as the custodian wallet providers, were some of the platforms which became an obliged entity under the 5AMLD.
  12. Many cryptocurrency organizations among the European Union are seeking clear-cut regulations for increased transparency with their users otherwise are forced to have restricted as well as inefficient functioning.
  13. According to the authorities, it would be easier for them to curb the organizations which consistently use cryptocurrencies for their functioning then regulating the cryptocurrencies itself.
  14. All the Crypto to Fiat exchanges is forced to follow the European Union legislation.
  15. The cryptocurrency organizations are burdened with huge expenses due to the compliance of 5AMLDs. Even the British Prime Minister Theresa May expressed her distaste regarding the cryptocurrencies by the way they can be used for illegal activities.

Conclusive remarks

The cryptocurrency market among the members of the European Union lacks some kind of maturity due to the repulsion of the institutional investors due to the lack of regulations and increased speculations. Whereas the countries across South Africa have taken bold moves in the field of cryptocurrency regulation. Switzerland is the only country which doesn’t seem to be a part of European Union and has a completely open mindset towards it.

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Written by Coinnounce Team

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