The Crypto industry has a new focus: Europe. Crypto lobbyists are in the midst of an intensifying battle with U.S. regulators. Now that Europe wants their business, they may have an extra edge.
Tough capital rules for banks holding cryptoassets must be fast-tracked in the European Union’s pending banking law if Europe wants to avoid missing a globally-agreed deadline.
Industry leaders are increasingly making the trans-Atlantic juxtaposition to argue for clearer regulations as U.S. agencies begin to enforce decades-old rules for trading and banking in the crypto world.
Congress, however, is nowhere near being able to determine a federal standard for digital currency. Regulators appointed by President Joe Biden are filling that void.
American politicians are at odds over whether to embrace or discourage the growth of crypto and regulators taking matters into their own hands.
But in the E.U., the bloc is preparing to activate new laws tailor-made for digital asset companies. Many European officials are beginning to pitch the EU as a welcoming place for crypto businesses to set up shop.
The global Basel Committee of banking regulators from the world’s main financial centers has set a January 2025 deadline for implementing capital requirements for banks’ exposures to cryptoassets such as stablecoins and bitcoin.
To enforce Basel’s crypto rules, the EU could either propose a new law or expand the banking law it is now finalizing as called for by the European Parliament.
Parliament and EU states have equal say on the banking law and are due to start negotiating the final text, which could include the provisions on cryptoassets.
This would give banks clarity on their requirements for crypto-asset exposures and would ensure that risks stemming from these are adequately addressed.
At stake is America’s reputation as a promoter of innovation and a global hub for finance.
While the crypto world has lost political clout in recent months, the advancement of the EU is providing fresh motivation for industry allies in Congress to press ahead with their agenda.
Be the first to comment