Gary Gensler discusses digital currency regulation with EU as Europeans demand rules for member states
The new chairman of the United States Securities and Exchange Commission (SEC), Gary Gensler, discussed digital currency regulatory issues with his European Union counterparts, in a session that has been described as a “exchange of views” between the two regulatory blocks.
Appearing virtually before the European Parliament’s Committee on Economic and Monetary Affairs, Gensler noted that technological advances are bringing the American and European markets closer and closer.
In particular, he drew parallels with the rise of the Internet in the 1990s and the profound impact that had on shaping financial markets and society more generally on a global scale.
“I think the transformation we are going through could be as big as the internet in the 90s.”
He also specifically addressed digital currency assets, noting that it was already a $ 2 trillion asset class operating around the clock, with “no borders or borders.”
When asked if there are technological opportunities to improve regulation in digital currency markets, Gensler responded by saying that there are, but that a combined approach among regulators is needed to secure the benefits. optimal results.
“Yes, there are technologies that can help platforms fight money laundering and protect investors. But I also think it’s a combination of the hardware and the software on the platforms, the software in particular, and what you do in your legislative body and what we do as regulators. “
The comments follow the publication of a recent survey of European stakeholders in Member States, who have found an overwhelming appetite for digital currency regulation to be managed at the state level rather than the supranational level.
The large-scale survey covered 12 member states across the bloc, finding that a majority of respondents would prefer digital currency to be regulated at the individual state level.
Some 31,000 people were interviewed in Estonia, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, the Netherlands, Poland, Portugal and Spain, as part of the largest study of its kind.
A majority of respondents also said they preferred their own governments to create national digital currencies, as a mechanism to achieve financial independence from the European Union as a bloc. On average, 30% of respondents in each country came to the same conclusion, with Greece (40%), Italy (41%) and Estonia (39%) leading the way.
The findings come as the European Union moves forward with plans to regulate digital currencies at the supranational level, assuming the authority to regulate the sector, despite the fact that 60% of those polled said they would prefer this to be regulated by their own national governments.
The European Commission is pushing through regulations that would apply to digital currency assets across the bloc. In September 2020, he proposed a new digital finance package with legislative proposals for member states.
The Commission said the proposals would benefit the industry “by making the rules safer and more digitally-friendly for consumers, the Commission aims to boost responsible innovation in the EU’s financial sector, especially for start-ups. very innovative digital ups “.
The developments in Europe come as Gensler and the SEC continue to lay out their latest thoughts on regulating the digital currency industry in the United States. Having recently taken office, Gensler clarified its vision for digital currency and its approach to regulation, with a focus on protecting investors and consumers.
Despite his own academic interest in digital currency and blockchain technology, describing digital currencies in particular as “interesting,” Gensler said he intended to look at issues around digital currency regulation only in the prospect of protecting consumers from the investment risks associated with digital currency. and investments in digital assets.
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