German BaFin official calls for 'innovative' EU-wide DeFi regulation

Birgit Rodolphe, Executive Director of the German Federal Financial Supervisory Authority (BaFin), called for innovative and uniform regu...

Birgit Rodolphe, Executive Director of the German Federal Financial Supervisory Authority (BaFin), called for innovative and uniform regulation of the decentralized financial space (DeFi) across the European Union (EU).

BaFin is the German financial regulator responsible for regulating banks, insurance companies and financial institutions, including cryptocurrency companies. BaFin is the issuer of “crypto custody licenses,” a permit required for companies wishing to offer cryptocurrency services in Germany.

In a article on the BaFin website, Rodolphe warned of the risks to consumers from the unregulated DeFi space and called for standardized regulatory considerations across EU member countries.

Birgit Rodolphe, Executive Director Anti-Money Laundering Treatment and Prevention at BaFin.

“One thing is clear: time is running out. The longer the DeFi market remains unregulated, the greater the risk to consumers, and all the greater the danger that critical offers with systemic relevance will establish themselves.

She cited consumer risks from “technical glitches, hacks and fraudulent activity” that have seen millions lost and claimed that DeFi is not as “democratic and altruistic” as its fans claim, and that DeFi products are “hard for many to grasp”. She concluded that DeFi protocols are not free to operate outside of regulations simply because they use new technologies.

“Utopia? Or rather dystopia? Who do I contact if I want to defer my crypto loan? What happens if my crypto assets suddenly disappear? In any case, there is no protection fund deposits for such cases.

She added that lending, borrowing, insurance and other products outside the traditional financial system are subject to licensing and supervision where they are offered, and called on regulators to establish rules that will give DeFi providers legal clarity.

Rodolphe highlighted BaFin’s “crypto custody activity” license launched in January 2020 as an “attractive” regulatory regime for crypto businesses.

The license allows companies to offer crypto services in Germany. Currently, only four providers are licensed, but many financial institutions have submitted an application. Rodolphe wrote that the regulatory frameworks should be the same in different European countries:

“Ideally, these requirements would of course be uniform across the EU to avoid a fragmented market and take advantage of all of Europe’s innovation potential.”

Related: European watchdog lists crypto alongside lawyers and accountants as an AML threat

Germany climbed to first place the most “crypto-friendly” country in the first quarter of 2022 partly due to its policy of zero long-term crypto capital gains tax. A March 2022 report revealed that nearly half of Germans are interested in investing in crypto.

Germany has also taken many steps related to cryptography through his government in 2021 with legislative reforms to embrace blockchain and tougher regulations on crypto businesses. The country’s central bank has played a leading role in testing a European Central Bank digital currency.

Rodolphe concluded that the new DeFi regulations cannot be weaker than the standards already in place with traditional financial products, as it could make DeFi products more attractive to businesses from a regulatory perspective.

Source Link



Africa,963,Americas,4386,Art & Culture,16230,Arts,6825,Arts & Design,1929,Asia,3613,Automobile,577,Baseball,849,Basketball,692,Books,4241,Business,5725,Celebrity,2633,Cricket,648,Crime,158,Cryptocurrency,2197,Dance,724,Defense,836,Diplomatic Relations,2496,Economy,1408,Editorial,260,Education,1525,Elections,308,Energy & Environment,3203,Entertainment,23734,Environment,3987,Europe,4577,Faith & Religion,234,Family & Life,817,Fashion & Style,3689,Finance,21995,Food & Drink,4166,Football,1318,Games,97,Gossip,10288,Health & Fitness,4514,Health Care,974,Hockey,285,Home & Garden,919,Humour,994,Latin America,49,Lifestyle,18649,Media,527,Middle East,1765,Movies,2060,Music,2995,Opinion,4125,Other,13264,Other Sports,5504,Political News,11323,Political Protests,2324,Politics,18905,Real Estate,2329,Relationship,106,Retail,3116,Science,2993,Science & Tech,11258,Soccer,389,Space & Cosmos,463,Sports,13676,Technology,3815,Tennis,746,Theater,1981,Transportation,313,Travel,2868,TV,4039,US,1595,US Sports,1481,Video News,3531,War & Conflict,1069,Weird News,996,World,18301,
Newsrust - US Top News: German BaFin official calls for 'innovative' EU-wide DeFi regulation
German BaFin official calls for 'innovative' EU-wide DeFi regulation
Newsrust - US Top News
Loaded All Posts Not found any posts VIEW ALL Readmore Reply Cancel reply Delete By Home PAGES POSTS View All RECOMMENDED FOR YOU LABEL ARCHIVE SEARCH ALL POSTS Not found any post match with your request Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS PREMIUM CONTENT IS LOCKED STEP 1: Share to a social network STEP 2: Click the link on your social network Copy All Code Select All Code All codes were copied to your clipboard Can not copy the codes / texts, please press [CTRL]+[C] (or CMD+C with Mac) to copy Table of Content