The popularity of cryptocurrencies across the globe is no secret to most. From the Bitcoin bubble offering good news to investors, to talk of volatility and crashing markets which keeps investors on the edges of their seats, cryptocurrencies are proving to be quite the innovation in the digital world as of late.
From the creation of Bitcoin back in 2009, to the introduction of countless altcoins and tokens like Dash and Power Ledger that are starting to give their predecessor a run for its money, investors, consumers and more are starting to dip their toes into the cryptocurrency world. However, with increased popularity comes talk of regulation in an attempt to control this decentralised currency, and the EU are proving to be the next in talks about restrictions ? but could they really enforce regulation on cryptocurrency? Find out more below.
Where Has The EU Stood So Far?
In recent months, cryptocurrency use in the EU has remained pretty much unregulated. These digital coins operating on decentralised networks are remaining as exactly that, however this began to change in December of 2017. While Brexit is ultimately leading to the UK’s split from the EU in 2019, it seems like they’re still in agreement about the need for regulation when it comes to cryptocurrencies, as reported on December 4th 2017. To date, nothing has come into play in order to regulate this, but talks have set the industry on edge, and rightly so. From Bitcoin users looking to spend their cash, to investors debating their next big investment move, this lack of clarity has the potential to cause an already volatile market to become even more so.
However, it is clear that the UK treasury and the EU are looking to end anonymity surrounding cryptocurrencies, but when this is one of the biggest selling points of the online currency, it can be difficult to see exactly how they plan on doing so without changing the cryptocurrency market as we know it.
What About Now?
Despite talks of regulation, there has been no progress directly made in relation to cryptocurrency use in the UK, or the rest of the EU. The European Central Bank (ECB) have even come out to say that the regulation of cryptocurrencies isn’t “exactly a very high thing on our to-do list” which arguably contradicts everything that the EU had been saying regarding the importance of cryptocurrency regulation in the past.
However, a press release by the European Commission of a speech made in Brussels on 26th February 2018 made it clear that they were looking to discuss cryptocurrencies at G20, to the point of asking for it to become a topic there. The speech goes on to explain that the ’roundtable’ would discuss:
- The implications of cryptocurrencies for financial markets
- The risks and the opportunities associated with their use
- The recent development of Initial Coin Offerings
The conclusion was that further discussion and assessment was necessary before action could be taken.
Does It Need To Be Regulated?
What this all boils down to, however, is the conversation around whether or not cryptocurrencies should be regulated. The current discussions seem to be centred on removing the decentralised or anonymous nature of cryptocurrencies, which could prove to damage cryptocurrencies as we know them to be today. As two of the main features of cryptocurrencies, the removal or restriction could send current users away from cryptocurrency ? but is this a necessary evil? With talk of fraud and money laundering, governments would agree that yes this regulation is necessary and in a sense, it could be. However, it’s also possible that alternate regulations could be put in place to protect the current state of cryptocurrencies and protect those that use them simultaneously.
Overall, the EU’s talks about regulation on cryptocurrency are currently remaining as just that. While it is possible that regulation will be put into effect sometime in the next few years, exactly what that would entail has yet to be seen and no plans are currently in place for the public to hear. In other words, watch this space.
