The vice president of the European Commission has said that “crypto-assets are here to stay” at the second informal Economic and Financial Affairs Council (ECOFIN) press conference.
At the ECOFIN press conference in Vienna, vice president Vladis Dombrovskis spoke of the discussion between himself and other ministers, describing it as a “good exchange” with regards to the future of cryptocurrencies and initial coin offerings (ICOs).
In his speech, Dombrovskis said, “We also had a good exchange of views on crypto-assets. We see that crypto-assets are here to stay. Despite the recent turbulence, this market continues to grow.”
He continues, “In particular initial coin offerings, or ICOs, we see they have the potential to emerge as a viable form of alternative financing. Already last year, ICOs helped raise over 6 billion dollars in funding and this year this figure will be substantially bigger.”
These positive remarks are however underpinned by a somewhat cautious attitude; he highlighted risks such as investment protection, market integrity, as well as money laundering among other nefarious activities that regulators, governments and industries are trying to stamp out or protect themselves against.
Dombrovskis asserted that there is a “need to continue monitoring developments in this area”, calling upon international partners such as the Financial Stability Board or G20 to cooperate.
Describing the challenges imposed by digital currencies, he cited a common issue that has plagued the progress of legislation and regulation which is the classification and categorization of digital assets. This would determine “whether and how to apply existing EU financial rules to these new assets or if we need new EU rules”.
Australia has been tackling this issue head on, while developing a means to tax cryptocurrencies. Several steps were been taken to define digital assets in a taxable context as accurately as possible.
The US has been wrestling the issue in a similar manner. The Supreme Court of the United States ruled on 21 June that Bitcoin could be used as a currency; this came as a result of a hearing that debated whether stock options can be taxed the same way that cash earnings are.
Earlier in June, the US Securities and Exchange Commission (SEC) declared that Bitcoin and Ethereum would not be regulated as securities; the subject digital assets being classified as securities in the states has been an ongoing matter for some time.
At the tail end of the speech, the vice president said that there is an ongoing effort between ECOFIN and the European Supervisory Authorities that he called “regulatory mapping of crypto assets”. Member states are in support of the mapping effort and Dombrovskis is expecting the assessment to be concluded this year.
The European Parliament recently held an all-party meeting that examined proposals for ICO rules. No formal statements have emerged from this discussion as of yet, but the speech given by Dombrovskis appears to echo the progressions made across departments of the EU.
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