EU Parliament plans crypto regulation for European banks
The EU Parliament sees cryptocurrencies as a risk to European banks and aims to safeguard the financial stability of the institutions with new legislation.
The EU Parliament sees cryptocurrencies as a risk to European banks and wants to safeguard the financial stability of the institutions with a new law.
Banks in the European Union (EU) could treat cryptocurrencies in the future as the riskiest asset class. This is laid out in a draft law from the EU Parliament.
The proposed rules should spell out how the traditional financial sector handles digital assets. Banks would have to disclose their direct and indirect involvement in the crypto sector.
"The potentially increasing involvement of (financial) institutions in crypto-asset activities must be thoroughly reflected in the Union's supervisory framework," the draft states.
"This is even more urgent in light of recent negative developments in crypto-asset markets," he adds. In November the crypto exchange FTX collapsed. Since then, prices for all crypto assets have been volatile, but have recently recovered.
In June, further proposals on the legal provisions for banks regarding cryptocurrencies will be released. In the meantime, the EU Parliament will cast a final vote on the groundbreaking MiCA crypto regulation.
