EU Commission consultation on an EU framework for markets in crypto-assets

The consultation runs until 19 March 2020 and people can respond to the questionnaire via the online web link at https://ec.europa.eu/info/law/better-regulation/initiatives/crypto-assets-2019/public-consultation_en

The 117 questions posed cover a wide range of topics including regulation of tokens and stablecoins. The full document can be downloaded at https://ec.europa.eu/info/sites/info/files/business_economy_euro/banking_and_finance/documents/2019-crypto-assets-consultation-document_en.pdf.

It is refreshing that the document includes observations that are cautiously supportive of the crypto space, such as (my emphasis):

"Crypto-assets have the potential to bring significant benefits to both market participants and consumers. For instance, initial coin offerings (ICOs) and security token offerings (STOs) allow for a cheaper, less burdensome and more inclusive way of financing for small and medium-sized companies (SMEs), by streamlining capital-raising processes and enhancing competition. The ‘tokenisation’ of traditional financial instruments is also expected to open up opportunities for efficiency improvements across the entire trade and post-trade value chain, contributing to more efficient risk management and pricing. A number of promising pilots or use cases are being developed and tested by new or incumbent market participants across the EU. Provided that platforms based on Digital Ledger Technology (DLT) prove that they have the ability to handle large volumes of transactions, it could lead to a reduction in costs in the trading area and for post-trade processes. If the adequate investor protection measures are in place, crypto-assets could also represent a new asset class for EU citizens. Payment tokens could also present opportunities in terms of cheaper, faster and more efficient payments, by limiting the number of intermediaries.

Submit your responses without delay as this will help to shape the crypto regulation across Europe and could be adopted beyond the EU too.