EU cryptocurrency regulations appear to be on the list of the key priorities for ESMA. The primary financial regulator of the EU markets is planning to invest as much as €1.1 million into monitoring cryptocurrencies and other Fintech areas.
5 October 2018 – The EU’s financial markets regulator, the European Securities and Markets Authority (ESMA), revealed that it plans to invest more than €1 million in order to develop a framework for overseeing cryptocurrencies and other FinTech activities during 2019.
ESMA Releases its 2019 Annual Work Programme
ESMA’s 2019 Annual Work Programme was released today and it outlines the regulator’s key priorities for the upcoming year. The document also presents the planned budget for the upcoming year and staffing numbers across ESMA’s key areas of focus.
The agency elaborates on its plans in the document, adding that as part of its strategy to protect the economic bloc’s financial stability, the regulator is about to adopt a “particular focus” on the financial innovation. This initiative would include studying the innovation regarding cryptocurrency assets. The ESMA stated that it actively looks for issues and risks that are linked to such activities.
The regulator goes on to explain that the promotion of regulatory initiatives on market monitoring would be highly beneficial for the sector. ESMA notes that it is necessary to promote best practices and provide advice or propose "relevant actions where needed."
ESMA Crypto Initiatives
The primary objective for the upcoming year for ESMA is as follows:
"Achieve a coordinated approach to the regulation and supervisory treatment of new or innovative financial activities and provide advice to present to the EU institutions, market participants or consumers."
Following on this, ESMA plans to execute a framework that is based on the product intervention authority powers provided by the EU's Markets in Financial Instruments Directive (MiFIR).
According to Ivan Gowan, CEO at Capital.com:
“On 3 Jan 2018, the European Securities and Markets Authority (ESMA) received product intervention powers, as the Markets in Financial Instruments Regulation (MiFIR) came into force. This allows ESMA to temporarily dictate regulations across all 28 EU member states, either in support of or overruling the National Regulator.”
ESMA sees the following outputs as desirable:
“Ongoing monitoring of retail investor trends, financial activities, and innovation, including Fintech;
Ongoing market intelligence gathering.”
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