The European Parliament has given its overwhelming approval for new regulations that will govern the trading of cryptocurrency. These new measures are set to take effect from July 2022, and they aim to ensure that crypto assets can be traced, preventing money laundering, terrorist financing, and other crimes. Major crypto service providers, which are often responsible for a high carbon footprint, will also have to disclose their energy consumption. Those facilitating the trading of the currency will also be required to register with an oversight body.
The European Parliament approved the regulations with a majority of 517 votes in favour, 38 against, and 18 abstentions. While some MEPs are of the view that cryptocurrencies are still in their infancy, with doubts over their long-term future, the European Union is seeking to regulate crypto markets, making it one of the first legislative bodies to do so. When the Health Service Executive was hacked in 2021, those behind it demanded a cryptocurrency ransom. Therefore, these new regulations will ensure that such incidents are prevented in the future.
One of the key aspects of the new regulations is the climate element, where service providers would have to disclose their energy consumption. This is a significant step towards reducing the carbon footprint of the crypto industry, which has been a major concern for environmentalists. European Commissioner for Financial Services Mairead McGuinness said that these regulations will allow the sector to evolve in a safer environment.
Sinn Féin MEP Chris MacManus was involved in negotiating the new regulations. He acted as shadow rapporteur for Left Group, meaning he negotiated on the group’s behalf. Speaking to RTÉ’s European Parliament Report, Mr MacManus said that while he did not necessarily want to foster or encourage the growth of cryptocurrencies, he believed there was a need to regulate the market. He also said that the future viability of cryptocurrencies was not certain.
MEPs largely agree that regulations will have to be updated on a continuous basis, in order to evolve with the crypto sector. This is a rapidly changing industry, and it is important that regulatory bodies keep up with the latest developments. By doing so, they can ensure that the industry is safe, transparent, and accountable. The new regulations are a significant step in the right direction, and they are likely to be followed by other legislative bodies around the world.
In conclusion, the European Parliament’s approval of new regulations governing the trading of cryptocurrency is a significant development for the industry. These new measures will ensure that crypto assets can be traced, preventing money laundering, terrorist financing, and other crimes. They will also require major crypto service providers to disclose their energy consumption, reducing the carbon footprint of the industry. While some MEPs have doubts about the long-term viability of cryptocurrencies, they agree that regulations will have to be updated continuously to keep up with the evolving sector. Overall, these new regulations are a positive step towards making the crypto industry safer, more transparent, and more accountable.
