Time to Be Conservative about Crypto Industry
Amongst the worldwide regulators of financial matters, Germany’s Bafin is considered to be the strictest of them all.
Although locally Germany’s financial regulator is called ‘Bafin’ but internationally it is recognized by the name ‘Federal Financial Supervisory Authority.
So when it comes to matters pertaining to the crypto industry, Bafin seems to be a lot more conservative.
The person who is in charge of the affairs of Bafin pleaded to the worldwide governments and regulators that crypto regulation should be done immediately at the global level.
Globalization of Crypto Regulation
Mark Branson is Bafin’s Chairman who argued that globalization of crypto regulation would ultimately protect the consumers.
He also argued that the regulation would help worldwide regulators and authorities in preventing crimes such as corruption and money laundering.
Branson emphasized that crypto regulation at the global level is the key to putting back global economies on track. He insisted that for the sake of bringing financial stability worldwide, crypto regulation is a must.
The comments of Bafin’s Chairman came soon after the news pertaining to FTX’s ex-CEO, Sam Bankman-Fried’s arrest.
Although SBF claims that he had no bad intentions in mind for the users, still, he used the wrong track to help them.
He eventually ended up causing a major catastrophe in the entire cryptocurrency, leaving people with huge losses.
FTX’s CEO has been arrested from outside the US but on the specific charges leveled against him by the US authorities. Bankman-Fried has been accused of money laundering and mismanaging the funds held by bankrupt FTX.
Collective Efforts at Global Level Need of the Hour
Branson was speaking to the local press in Frankfurt, Germany where he passed such remarks on 13th December 2022.
He emphasized that a collective effort is required because the regulators have long been played at the hands of fake artists in the crypto industry.
He suggested that while there is no issue with the crypto industry yet it is the responsibility of the regulators to clean the industry. He acknowledged that it is time to let the industry flourish as a place for mature people.
Branson emphasized that at the end of a season there is another season, hence, after the crypto spring season fall, crypto winter shall begin.
However, he warned that with changing seasons, further knots would lose revealing links with FTX or have connections of their own.
He argued therefore that the changing times warrant the laying down of crypto regulations globally on an emergency basis.
Serious and Effective Exercise of Regulatory Powers
Branson urged that the time has come which requires regulators to ensure the fulfillment of their duties towards the industry more seriously and effectively.
Bafin’s Chairman also suggested that one-sided efforts in crypto regulation by the European region alone would be insufficient. He insisted that the matter requires collective efforts from all regions of the world.
A single regulatory authority cannot achieve the ultimate goal.
The regulatory authorities and governments from all over the world have to work together to come up with stronger regulations around cryptocurrencies.
European Legislation of Crypto Industry and Assets
It may be noted that the European region is working side by side with all member states in structuring a legal framework for the digital asset industry.
They have proposed legislation called MiCA i.e. Markets in Crypto Assets. All member states of the region gave their consent in writing by entering into an agreement executed in July this year.
It is anticipated that the agreement shall come into force somewhere in the upcoming year.
As per the provisions of the agreement, the region will develop a joint regulatory structure for supervising the crypto industry and digital assets.
However, European Central Bank is of the view that a further time (preferably more than a year) would be required for implementation.