{"id":353135,"date":"2018-10-08T19:30:14","date_gmt":"2018-10-08T19:30:14","guid":{"rendered":"https:\/\/wncen.com\/?p=353135"},"modified":"2018-10-08T19:02:36","modified_gmt":"2018-10-08T19:02:36","slug":"eu-financial-watchdog-to-determine-icos-outside-of-regulatory-world","status":"publish","type":"post","link":"https:\/\/wncen.com\/news\/ai-and-tech\/eu-financial-watchdog-to-determine-icos-outside-of-regulatory-world\/","title":{"rendered":"EU Financial Watchdog to Determine ICOs Outside of “Regulatory World”"},"content":{"rendered":"
The European Securities and Markets Authority (ESMA), the European Union’s financial watchdog, has announced it is taking the same approach to initial coin offerings (ICOs) as its U.S. counterpart. The agency is examining all types of cryptocurrency fundraisers to determine how they fit EU’s regulatory framework.<\/p>\n
Governments across the globe have been attempting to fit digital tokens distributed on ICOs into their regulatory frameworks, as the cryptocurrency ecosystem shows no signs of slowing down its pursuit of disrupting economies and societies.<\/p>\n
Japan<\/a> and Singapore<\/a>, among others, have already introduced a regulatory framework for digital currencies. Now, it’s the EU’s turn, according to Steven Maijoor, chair of ESMA. The agency is analyzing how the introduction of ICOs into the regulatory landscape will affect\u00a0competition in the fundraising sector.<\/p>\n “Some of these ICOs are like a financial instrument. Once it is a financial instrument it comes under a whole regulatory framework […] The subsequent question is what do we do with those ICOs that are outside the regulatory world. We will assess that as a board. We expect to report by the end of the year.”<\/p><\/blockquote>\n At European Parliament\u2019s economic affairs committee,\u00a0Maijoor told MPs that the regulator and its member-states counterparts are evaluating initial coin offerings on a case-by-case basis to determine which fall under EU’s regulation, reports Reuters<\/a>.<\/p>\n ICO investors, so far, have been unprotected by government authorities. Maijoor added that the cryptocurrency fundraisers haven’t shown viability as of yet.<\/p>\n In March 2018, ESMA announced new rules on contracts for differences (CFDs) and binary options trading. The imposed measures, from 1 August 2018 onwards, limited leverage for cryptocurrency margin trading to 2:1. Other than that, EU regulators only warned retail investors about digital assets.<\/p>\n Consumer warnings, however, are unable to raise enough awareness in regard to the risk of ICOs, according to\u00a0Andrea Enria, chairman of the European Banking Authority, who initially defended minimum regulatory interference on innovation such as ICOs.<\/p>\n “This is not working as expected […] Consumer warnings don\u2019t seem to be sufficiently effective in raising awareness among consumers that there is a lack of safety net for these investments.”<\/p><\/blockquote>\n