Between risks and opportunities, the debate on the possibility of regulating virtual currencies has been relaunched. This was one of the aims of the round table chaired by the European Commissioner for Financial Services, Valdis Dombrovskis, in Brussels on Monday 26 February, which was attended by representatives of the European institutions, European governments, supervisory authorities, central banks and the industry.
“Based on the assessment of risks and opportunities and the suitability of the existing regulatory framework for these instruments”, the Commission will determine if regulatory action at EU level is required, Commissioner Dombrovskis told the press following the meeting. Not, therefore, ruling out the possibility that the EU will go it alone in this area, he said that it appears at the moment that an international response is taking shape.
The aim of this roundtable, he explained, was to consolidate the EU's position ahead of forthcoming discussions at the G20. Readers may recall that the question was added to the agenda by France and Germany, which intend to propose joint recommendations at the meeting in Buenos Aires on 19 and 20 March for the international regulation of Bitcoin (see EUROPE 11943).
“On its own, Europe represents only a small share of global crypto-currency trading, so we need to work together with our partners in the G20”, he stressed. Transactions in virtual currencies denominated in euro or European currencies indeed represent just 4% to 5% of the global market.
During the meeting, the implications of crypto-currencies for the financial markets, the risks and opportunities related to their use, but also the recent development of initial coin offerings in crypto-currency (ICO) were all discussed.
The participants recognised that 'blockchain' technology is highly promising for the financial markets, Dombrovskis reports. He considers that Europe must not miss this particular boat and in order to remain competitive, should embed this innovation. However, various speakers also acknowledged the risks to which consumers and investors are exposed, particularly in matters of speculation.
Another aim, moreover, was to feed into the Commission's reflection, already at an advanced stage, concerning financial technologies (FinTech) with a view to the action plan it is due to present on 7 March. In a draft text dated February (see EUROPE 11955), the institution stayed on the fence over this question and did not provide for additional actions, apart from continuing to follow developments closely.
According to our information, no further roundtables of this kind are currently scheduled. Discussions at international level should therefore define the specific next steps, which are unlikely to be announced before the second half of 2018 or even early 2019, Dombrovskis said. (Original version in French by Marion Fontana)