[2018-05-21] Spanish Regulator Open to Aprv. Funds Investing Directly in Crypto

[ivanpoldark]

Spain’s financial regulator has clarified its position on regulated investment funds investing directly in cryptocurrencies. These type of funds are legal under Law 22/2014, and investments can be made through three types of legal entities.

Funds Directly Investing in Cryptocurrencies

Spain’s National Securities Market Commission (CNMV – Comisión Nacional del Mercado de Valores) recently clarified its position on registered funds investing in cryptocurrencies directly. The CNMV is the Spanish government agency responsible for regulating the securities markets.

In a Questions and Answers document addressed to fintech companies on activities and services that can have a relationship with the Commission, one of the questions was “Can a fund registered by the CNMV directly invest in cryptocurrencies?” The Commission replied:

This type of funds would have a legal place in Law 22/2014, which regulates, in addition to venture capital entities, other collective investment entities of closed type and their management entities.

Law 22/2014 establishes, among others, closed-end collective investment entities (EICC), closed-end investment funds (FICC), and closed-end investment companies (SICC), Iclg describes.

Read more: https://news.bitcoin.com/spanish-regulator-approving-funds-investing-directly-cryptocurrencies/

[1Referee]

Theoretically it looks good, but the problem is that the regulatory framework is far too complicated. If you follow one route as professional party, you have to abide by two or three other rules, which is just insane. I get it that there have to be rules, but this isn't stimulating economical activity. It only creates confusion and prevents parties (mainly smaller ones) from entering the market.

Just look at how many institutions are ready to jump on board, but the legal route for them is either completely blocked, or so complicated that the risks of by mistake crossing a yet unknown line is just not worth the potential penalties, whatever they may be. It's not for nothing that a lot of the current institutions use proxies to get at least some direct crypto exposure.