Germany’s financial watchdog has issued a call for global regulation of the crypto industry in the aftermath of the FTX collapse. The hands-off approach was wrong, the head of the agency says, insisting it’s time to protect consumers as the sector expands links with traditional finance.
Bafin President Convinced Self-Regulation Won’t Work for Crypto
The man at the helm of the Federal monetary supervisory Authority of Germany (Bafin) has urged for international regulation of the cryptocurrency space. this is able to guarantee better protection for consumers, prevent money laundering and preserve monetary stability, according to Mark Branson.
A that would approach that may “just let the industry grow as a playground for grownups” was the wrong tactic, the executive told reporters in frankfurt on Tuesday, shortly after U.S. authorities charged SAM Bankman-Fried, founder of failing crypto exchange FTX, with fraud and other crimes.
A “crypto spring” might follow what has been a “crypto winter” however what emerges within the end is likely to have additional links with the traditional financial system, any increasing the need for regulation, Branson emphasized, as per Reuters. He was additionally quoted as stating:
Now is the time for serious cryptocurrency regulation.
Germany’s high monetary regulator elaborated that a european solution alone wouldn't be sufficient however what’s needed could be a worldwide one. Crypto regulation so far has been loose and patchwork, the Bafin official added.
The European Union has been performing on its new Markets in Crypto Assets (MiCA) legislation, with EU institutions and member states reaching an agreement on the package in July of this year, that is expected to enter into force in 2023.
Its main purpose is to establish a harmonized regulatory framework for cryptocurrencies and related activities at the Union level. However, it'll take at least another year to apply its provisions across the 27-strong bloc and some officials, together with European central bank President Christine Lagarde, have already spoken about broadening its scope or even adopting “MiCA 2.”
The report notes that Branson has been skeptical about crypto before. In an interview published by the Eurozone’s monetary authority in November, the German remarked that “not all crypto business models are serious,” adding that “waves of innovation, as we know, additionally bring with them freeloaders and crooks.”
(Lubomir Tassev, Bitcoin.com, 2022)