Key Takeaways:
- MEPs have agreed to set new rules to make cryptocurrencies more consumer and climate-friendly.
- The lead MEP said that these rules would bring innovation.
The European Union has unanimously decided to adopt new rules for cryptocurrencies. A vote was conducted at the Economic and Monetary Affairs Committee on Monday evening, where 31 members voted for the motion. 4MEPs did not show support, and 23 refused to express their opinion.
Recently, the crypto market has been unstable with ongoing chaos like the Russian invasion of Ukraine, rug pulls, and scams. So the MEPs have decided to impose new rules to ensure consumer protection from these. It will also help them regulate the effect of mining on the environment and keep an eye on cryptocurrencies that include Bitcoin.
The rules will primarily include “transparency, disclosure, authorization, and supervision” of the transactions of crypto-assets. Provisions are also set to inform customers about all the “risks, costs, and charges” involved to protect against money laundering and illicit activities.
Measures will also be taken to moderate the activities related to crypto mining to reduce its harmful effect on the environment. The MEPs have also kept in mind the industries that are drawing heavy energy for crypto-related activities and therefore are not suitable for the climate.
The European Securities and Markets Authority (ESMA) has been asked to look over the allocation of “asset-referenced token.” Whereas the European Banking Authority (EBA) will be taking care of “electronic money tokens.”
The leader of MEPs, Stefan Berger, has said, “The regulation being created is pioneering in terms of innovation, consumer protection, legal certainty and the establishment of reliable supervisory structures in the field of crypto-assets.”
