European Parliament study recommends classifying crypto assets as securities.
A study commissioned by the European Parliament suggests that all crypto assets should default to being treated as transferable securities.
If a crypto asset intermediary wants to avoid being classified as a security, the study’s authors suggest that they can obtain an exemption from a national competent authority (NCA), which is the relevant regulatory authority in an EU member state.
The study, which was published in May and written by researchers from universities in Europe and beyond, argues that this approach is necessary due to the rapid pace of innovation in the crypto industry.
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Despite the recent signing of the EU’s MiCA regulations into law, the researchers expressed doubt about the feasibility of developing a comprehensive regulatory framework for crypto definitions at the EU level within a reasonable timeframe and at an acceptable cost.
The study also proposed a shift in the burden of regulatory compliance from national regulators to the entities that offer or facilitate the trading of crypto assets.
The authors argued that this would streamline the regulatory process and hold those directly involved in crypto transactions accountable.
In line with US practice
The proposal appears to be largely in line with the established practice in the US, where the major regulatory agencies have hinted that only Bitcoin should be treated as a commodity for regulatory purposes.
Among those in the US who have spoken out on the issue is Securities and Exchange Commission (SEC) Chair Gary Gensler, who has argued that most crypto tokens – with the exception of Bitcoin – should be classified as securities.