EU Official Floats New Rules for Crypto Assets

New rules around cryptocurrencies and blockchain-based assets could be developed in the months ahead, a European Union official said Monday.

In remarks made after the event, European Commission vice president Valdis Dombrovskis suggested that the bloc’s leadership could pursue additional oversight, though he said such an outcome “depends very much on the facts and circumstance around specific crypto-tokens” and that more work will be performed by the Commission on this front.

He told reporters:

“This depends very much on the facts and circumstances around specific crypto-tokens. 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.”

By contrast, Dombrovskis struck what appeared to be a positive tone about initial coin offerings (ICOs) while also acknowledging the risk for those investing in some of the blockchain projects which conduct token sales.

“[ICOs] have become a way for innovative firms in this field to raise substantial amounts of funding,” he was quoted as saying. “This is an opportunity, but there are also problems that expose investors to substantial risk, such as the lack of transparency regarding the identity of the issuers and underlying business plans.”

The vice president noted that a relatively small amount of cryptocurrency trading occurs within the EU and that, as a result, Europe needs to work with other G20 nations to address these possible risks.

In a way, he echoed a call by officials from France and Germany, two G20 members who said cryptocurrencies could “pose a substantial risk for investors” in a letter earlier this month.

Valdis Dombrovskis image via Johannes Jansson / Wikimedia Commons