EU agrees on landmark regulation to clean up crypto ‘Wild West’

[mynonce]

EU moves to rein in ‘wild west’ of crypto assets with new rules
“We have agreed that crypto asset providers should in future disclose the energy consumption and environmental impact of assets,” Berger said.
https://www.theguardian.com/technology/2022/jul/01/eu-moves-to-rein-in-wild-west-of-crypto-assets-with-new-rules

“Today, we put order in the Wild West of crypto assets and set clear rules for a harmonized market that will provide legal certainty for crypto asset issuers, guarantee equal rights for service providers and ensure high standards for consumers and investors,” said Stefan Berger, the lawmaker who led negotiations on behalf of the European Parliament.
https://www.cnbc.com/2022/06/30/eu-agrees-to-deal-on-landmark-mica-cryptocurrency-regulation.html

[franky1]

hmm "crypto asset issuers"

in short if you want to start a ICO in the EU where your company manages the pre-mine/limited progressive release and or coin/transaction validation stuff. where you as a company manage the code or updates for users..

PoW coins issued after 2023 will hit a bureaucratic brick wall. where as PoS coins get a free pass.

hmm "crypto asset providers"
well that smells and sounds like they mean exchanges and merchant tool services.. so i guess they wil need a "passport" to operate if they are accepting/servicing costumers with a PoW coin that is from a "issuer"(company managed ICO)

exchanges, say bye bye to EU customers wanting coins from an PoW ICO. much like many said bye bye to NY customers when bitlicence came in

[stompix]

Under the new rules, stablecoins like tether and Circle’s USDC will be required to maintain ample reserves to meet redemption requests in the event of mass withdrawals. Stablecoins that become too large also face being limited to 200 million euros in transactions per day.

Rofling myself to death

If this will ever become law I can already see tether saying its currency is not "designed" to operate in Europe., followed up by a ton of exchanges banning users from EU from trading USDT and any other "stable" coin. Those guys have never managed to prove they own the $ backing their coin, no way they will be able to do it now.

But tha's probably the only good thing out of this, the whole environmental issue is useless since electricity prices have done more damage to the mining industry in Europe than any regulation will ever do, and the rest is for sure going to turn from wonderful on paper into a nightmare in reality.

The European Securities and Markets Authority, or ESMA, will be given powers to step in to ban or restrict crypto platforms if they are seen to not properly protect investors, or threaten market integrity or financial stability.

This one made me curious, how are they going to enforce financial stability, is the ECB going to bail out Bitstamp or buy dogecoin to protect the price? 
Because:

The rules won’t affect tokens without issuers, like bitcoin, however trading platforms will need to warn consumers about the risk of losses associated with trading digital tokens.

So, all this is an altcoin issue, right?

[mk4]

Governments trying to regulate cryptocurrencies will be as effective as governments banning usage of illegal drugs. They'll be wasting their time.

[franky1]

Governments trying to regulate cryptocurrencies will be as effective as governments banning usage of illegal drugs. They'll be wasting their time.

the pun is
Governments trying to regulate cryptocurrencies will be as effective as governments banning [anything].
They'll be wasting energy and continuing the chain.

atleast they know they cant chase decentralised networks easy. so they are only going after the centralised ICO types.. which usually are where the scams are anyway.

[so98nn]

Poorly proposed plans and definitely not cleared various definitions of crypto coins whatsoever. As per first post they are lacking the clarification in between pow and pos coins. Im not sure how much population is involved from the EU region but for the coin issuer it would be far easier to ban EU users than to agree to the rules like this.

Crypto is so wide spread one can form the company in lets say UK and only allow the users from rest of the world to use it. Isn’t that’s funny?

[DooMAD]

Under the new rules, stablecoins like tether and Circle’s USDC will be required to maintain ample reserves to meet redemption requests in the event of mass withdrawals. Stablecoins that become too large also face being limited to 200 million euros in transactions per day.

Rofling myself to death

If this will ever become law I can already see tether saying its currency is not "designed" to operate in Europe., followed up by a ton of exchanges banning users from EU from trading USDT and any other "stable" coin. Those guys have never managed to prove they own the $ backing their coin, no way they will be able to do it now.

But if they do that, it's effectively an admission of being unbacked, so I'm definitely looking forward to the market's reaction to that.  Maybe people will finally recognise this stablecoin stuff is trash.

[mk4]

atleast they know they cant chase decentralised networks easy. so they are only going after the centralised ICO types.. which usually are where the scams are anyway.

Even going for centralized ICO types is next to impossible. By the time the authorities hear about specific projects, chances are, a good amount of money have been collected already.

[zasad@]

I think that the main problem may come after whom, when the regulator will force the exchanges to delist certain coins.
It is curious how the trial with Ripple in the USA will end. If cryptocurrencies start to be recognized as shares and impose huge fines on companies, then this will be a big problem for altcoins. There are no complaints about bitcoin in the US and Europe.

[franky1]

atleast they know they cant chase decentralised networks easy. so they are only going after the centralised ICO types.. which usually are where the scams are anyway.

Even going for centralized ICO types is next to impossible. By the time the authorities hear about specific projects, chances are, a good amount of money have been collected already.

shhh dont tell the other forum readers this.. but the authorities want criminals. so they can then confiscate their funds.
its not about prevention its more of punishment after the fact

[goldkingcoiner]

EU moves to rein in ‘wild west’ of crypto assets with new rules
“We have agreed that crypto asset providers should in future disclose the energy consumption and environmental impact of assets,” Berger said.
https://www.theguardian.com/technology/2022/jul/01/eu-moves-to-rein-in-wild-west-of-crypto-assets-with-new-rules

“Today, we put order in the Wild West of crypto assets and set clear rules for a harmonized market that will provide legal certainty for crypto asset issuers, guarantee equal rights for service providers and ensure high standards for consumers and investors,” said Stefan Berger, the lawmaker who led negotiations on behalf of the European Parliament.
https://www.cnbc.com/2022/06/30/eu-agrees-to-deal-on-landmark-mica-cryptocurrency-regulation.html

Ohhh again with the "wild west" comparison. This is the favorite comparison for crypto that is used by regulators ever since Bitcoin came into existence. Its been the wild west for how many years now? How many years have the regulation lawmakers been threatening scary new regulations?

Its all a big nothing burger and will not have any kind of effect on the world of crypto now or in the future.

Although personally, I would prefer a more responsible environmental law on energy production. But lawmakers do not seem to be ready to talk about that yet. I wonder how much money the energy lobby pays them to keep quiet.

[franky1]

Ohhh again with the "wild west" comparison. This is the favorite comparison for crypto that is used by regulators ever since Bitcoin came into existence. Its been the wild west for how many years now? How many years have the regulation lawmakers been threatening scary new regulations?

but what version of the wild west are the EU speaking of.. from europes prospective of the 17-1800's

the wild west of europe hearing of a place far away they cant touch which has freedoms the europeans dont
or the wild west of the place people go to,  to escape europes disease and poverty nations
or the place where people could actually own property, which they couldnt get in europe

i know the EU want to promote a outlaw/no law/savage landscape image. but. last time i checked. we are somewhat more civil that the cowboys of the 1700's

[amishmanish]

Europe is already losing the steam for quite a long time, Post colonial era europe is a utopian state with innovation as its foundation of economy. It know that it can't really regulate crypto and any non meaningful bans will only lead to own losses. Yet energy could be the last reason for bringing in regulation. They are already guzzling tons of pollution in air, land and seas. Controlling that will be more meaningful I assume

[kryptqnick]

I think the EU already has some crypto regulations, and I don't think more are needed. Cracking down on scams and things which are often a scam (like ICOs) would be good. It's probably a positive thing that they're setting requirements for stable coins because when they aren't really backed up by much and people don't realize how fragile the stability is, it's a potential catastrophe waiting to happen. What I also like is that the new rules won't apply to Bitcoin because it's considered a coin without issuers. And, of course, the environmental thing is ridiculous when the EU is looking at coal amidst the Russo-Ukrainian war but thinking of restricting crypto mining because it's allegedly not eco-friendly.

[Hispo]

I think that the main problem may come after whom, when the regulator will force the exchanges to delist certain coins.

Already happening,I think
One can't buy Monero on Binance.Us while on Binance worldwide, one can. Obviously, they will try to atttack the liquidity of coins that end up being an annoyance to them, attacking privacy tagging  as a crime like tax evasion.

If cryptocurrencies start to be recognized as shares and impose huge fines on companies, then this will be a big problem for altcoins. There are no complaints about bitcoin in the US and Europe.

I believe it would be mostly problematic to coins which offered a ICO, coins with had a fair initial distribution (did not sell their initial emissions to clients) should have no problem, in my oponion.
It is interesting to think of what could happen since Ethereum had an ICO and ended up being a huge success.

Regulators could say Ethereum foundation was involved in the selling of unregistered shares...

[hd49728]

It will affect old cryptocurrencies mostly because a new generation uses non Proof of Work algorithm. They are keen on smart contract, proof of stake, DAG etc. Those projects will not be affected too much by new regulation on energy consumption and environmental protection.

Some projects will be affected mildly if they are hybrid between Proof of Stake and Proof of Work.

Smart contract and Proof of stake can cause scam issues. Developers can mint new tokens from the air. Regulation can not do anything to prevent it from beginning.

[Gyfts]

It baffles me that they even try to paint this as an environmental issue. EU are obessed with green energy, part of why they're in their current predictament having to depend on Russian oil just to stay warm in the winter, but "energy consumption" is a convenient excuse in order to push crypto regulation.

Governments trying to regulate cryptocurrencies will be as effective as governments banning usage of illegal drugs. They'll be wasting their time.

the pun is
Governments trying to regulate cryptocurrencies will be as effective as governments banning [anything].
They'll be wasting energy and continuing the chain.

atleast they know they cant chase decentralised networks easy. so they are only going after the centralised ICO types.. which usually are where the scams are anyway.

There mere thought of regulation pushes away investors. Whether users like institutional crypto investors or not, they're part of the deal. Whether regulation is effective or not isn't the issue. Institutional investors aren't going to be attracted to a market they feel will be heavily regulated by the government. It never ends well.

[zasad@]

I think that the main problem may come after whom, when the regulator will force the exchanges to delist certain coins.

Already happening,I think
One can't buy Monero on Binance.Us while on Binance worldwide, one can. Obviously, they will try to atttack the liquidity of coins that end up being an annoyance to them, attacking privacy tagging  as a crime like tax evasion.

Coins like Monero are a separate case. And what will other coins do if the regulator recognizes them as shares, because they sold their coins?
And I understand that in the USA such issues will be resolved through lobbyists, but the prospects for the regulation of cryptocurrencies can negatively affect the price of many coins.

[Don Pedro Dinero]

It baffles me that they even try to paint this as an environmental issue. EU are obessed with green energy, part of why they're in their current predictament having to depend on Russian oil just to stay warm in the winter, but "energy consumption" is a convenient excuse in order to push crypto regulation.

The EU is pursuing suicidal energy policies. And making a fool of itself, let's look at one example:

Germany will fire up coal plants again in an effort to save natural gas.

There mere thought of regulation pushes away investors. Whether users like institutional crypto investors or not, they're part of the deal. Whether regulation is effective or not isn't the issue. Institutional investors aren't going to be attracted to a market they feel will be heavily regulated by the government. It never ends well.

I agree, what will happen with this kind of policies is that crypto investors will end up investing their money where they have more crypto-friendly regulations.The EU was never very crypto-friendly anyway

Of the big players I see in the world, such as the US, China, India, Russia, etc., I think the EU is the one that is going to be the worst off in a few years' time because of its suicidal policies..

[Lucius]

I agree, what will happen with this kind of policies is that crypto investors will end up investing their money where they have more crypto-friendly regulations.The EU was never very crypto-friendly anyway

We cannot say in general that the entire EU is hostile to cryptocurrencies, but it would be correct to say that some countries want to regulate this area much more strictly, while other countries do not share such attitudes. It is obvious that there is a section of bureaucrats in the EU who under the guise of some kind of climate issues attack Bitcoin and usually use it as a topic when attention needs to be diverted from some more important things, but the EU still consists of countries that do not share the same attitudes or opinions in many respects.

Money has always moved to where the conditions for profit are better, and if the EU wants everything to be clean and green, maybe they should go back to the Middle Ages and take over the castles again and declare themselves rulers of the blue blood...