EU movement on virtual currencies and distributed ledger technologies
By Jim Bulling and Michelle Chasser
The EU Parliament has called for the creation of a task force to be led by the EU Commission to monitor distributed ledger technologies (DLT) and virtual currencies (VC). The EU Parliament proposed that the task force consist of technical and regulatory experts who will:
- provide the necessary expertise to support EU member states’ efforts to monitor DLT;
- bring together stakeholders;
- foster awareness and analyse the benefits and risks of DLT;
- identify best practice standards;
- assess existing EU regulation with a view to updating it in response to increased DLT use; and
- develop stress tests for widely used VCs and DLT schemes.
The EU Parliament also recommended that the EU Commission revise EU legislation on payments in light of new technological developments with a view to furthering competition and lowering transaction costs possibly by means of promoting a universal and non-proprietary electronic wallet. The EU Commission is currently considering proposals to include VC exchange platforms in the EU Anti-Money Laundering Directive to end the anonymity that has been traditionally associated with such platforms.
This recent regulatory activity in the EU reflects the increased attention that VCs and DLT have been receiving from governments around the world. Australia has recently focused on anti-money laundering and tax implications for VCs and Japan introduced regulations on VC exchanges in March.