The Association for Financial Markets in Europe (AFME) is calling for greater supervisory convergence in crypto-asset regulation on the continent.
As the European Union and regulators seek to formulate a coherent policy on the nascent crypto industry, the AFME has put together its own five recommendations.
In a position paper, it calls for regulators to consider:
- The establishment of a pan-European crypto-asset taxonomy;
- Provision of clear expectations for market participants on the process for issuing crypto-assets;
- Application of activities-based and technology agnostic regulation;
- Application of existing regulation for regulated activities, with any necessary amendments if required;
- Prioritisation o convergence of regulatory frameworks with other global and regional initiatives.
James Kemp, MD, head, technology and operations, AFME, says: "There has been a rapid rise in the development of crypto-assets, which could offer significant benefits for wholesale markets.
"However, to realise those benefits, it is increasingly important that crypto-asset regulation is coordinated at the regional and global level to foster innovation, while promoting financial stability and ensuring a level playing field. This should start with forming a common understanding of the various crypto-asset terms and activities in financial services."
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