The European Commission will soon create common standards for blockchain technology and propose an EU-wide licensing system for crowdfunding platforms.
On Monday, it was reported that the European Commission – the independent executive arm of the European Union – has plans to create common standards for blockchain technology, the computational system that undergirds many of the world’s largest cryptocurrencies. As detailed in an EU document, the commission will also publish a draft proposal for a licensing system, which would be utilized throughout the European bloc, pertaining to crowdfunding platforms.
“An EU framework would offer a European passport, and, at the same time, ensure the proper management of platforms and the protection of fund providers,” the document explained. Instead of seeking authorization on a country-by-country basis, platforms could conceivably receive EU-wide approval, which would likely reduce compliance costs while saving time. Of course, in light of Brexit, the United Kingdom would not be party to such an arrangement.
Last week, European Commission vice president Valdis Dombrovskis said, “We need to assess further under what circumstances cryptocurrencies and related services are covered by existing regulation. This depends very much on the facts and circumstances around specific crypto-tokens.”
Now, per Reuters, the Commission will reportedly examine whether existing financial regulation appropriately applies to cryptocurrencies and initial coin offerings (ICOs).
It appears that the EU document also included hacking threat assessment suggestions for FinTech firms, as well as a cost-benefit analysis of “cyber threat testing” for large players in European financial markets.
With regard to blockchain standards, the document explained, “An EU-wide fintech market will not reach its full potential without the development of open standards that make interoperability possible, simplify the exchange of data between market players, and facilitate competition.”
Lastly, by the fourth quarter of 2018, the commission will apparently present a “blueprint” for regulatory sandboxes, which will include best practices and guidelines.