Steven Maijoor, President of the European Securities and Markets Authority (ESMA), said earlier this week at a financial technology forum in Brussels, Belgium, that he supports the application of financial instrument regulation to assets such as Bitcoin to help protect the investor.
Maijoor said that without new regulations, digital assets may not be covered by European securities laws. “If crypto assets are not eligible for financial instruments, we fear that the lack of applicable financial rules will expose consumers to significant risks.” Maijoor also hopes to apply the new rules to the initial coin offerings (ICO).
Maijoor pointed out that most European jurisdictions have agreed that if crypto assets are accompanied by profit or dividend rights, they should be regulated like traditional financial instruments. He added that he supports the expansion of European money laundering regulatory requirements, that is, not only the exchange of encrypted assets for currency, but also the exchange of one encrypted asset for another.
Maijoor also mentioned that other digital assets that provide substantial utility or consumer rights, as well as digital assets like Bitcoin as a trading medium, make the work of regulators more difficult. “This clearly shows that we cannot pass the ‘one size fits all’ approach. The way to legally regulate cryptographic assets.”