The old standards do not cover all participants in the cryptocurrency industry
The European Parliament recommended the concept of cryptocurrency and the expansion of the list of related regulated companies in the European Union, as the Fifth EU Anti-Money Laundering Directive (AMLD 5) no longer meets the FATF (standards developed by the Financial Action Force) .
The noticeable growth of token-based platforms became the basis for the introduction of “private tokens” as a subcategory of cryptocurrency. In addition, the current regulation excludes some participants in the cryptocurrency industry, which also support exchanges that do not support fiat currencies.
“There are coins, of which large server farms with high energy costs are not required for mining. Such coins can be placed at many hardware installations at home, and the installation itself can be of anyone, including criminals, ”the European Parliament report says.
Coin developers and non-custodian wallet suppliers are encouraged to be exempt from liability, as they provide only technical infrastructure.
In addition, cryptocurrencies are characterized by volatility, as a result of which they increase risk for investors. Additional difficulties arise due to the fact that cryptocurrency rarely fits into existing financial law.
“Currently, EU laws prohibit financial institutions from accessing or acquiring crypto assets as well as providing related services. If financial institutions decide to acquire them and add to their balance sheets or use them for an activity If taken, they can suffer heavy losses, ”the document says.
The best way to solve this problem may be to exclude cryptocurrency from such entities’ own assets, the authors emphasized, urging European regulators to attribute unregulated cryptocurrency to non-risk assets.
Summary PAYSPACE magazine
Recall that the rapid development of the coronavirus COVID-19 epidemic pushed developers to create a coronacoin cryptocurrency, the rate of which depends on the number of sick and dead.
The amount of Coronacoke tokens is based on the population of the Earth. Depending on the number of new cases, the money supply will decline every two days. It is believed that the more people fall ill or die, the higher the value of the currency.
Read: Cryptocurrency is a means of payment for fraudsters: The Chainalysis Report.