Italy's Central Bank and Securities Regulator Collaborate with Crypto Firms

Italy's central bank and securities regulator are actively engaging with cryptocurrency firms to enhance regulatory safeguards, addressing concerns over the widening policy gaps between the European Union (EU) and the United States (US).

Regulatory Developments in Italy

In July 2024, the Bank of Italy issued a communication on the implementation of Regulation (EU) 2023/1114, known as the Markets in Crypto-Assets Regulation (MiCAR). This regulation aims to harmonize the EU's approach to crypto-assets, introducing a unified framework for their issuance and offering to the public. The Bank of Italy emphasized the importance of distinguishing between various categories of crypto-assets, particularly concerning their suitability as means of payment. It highlighted that only electronic money tokens (EMTs), which are backed by a single official currency, are inherently suitable for payment purposes. The Bank also underscored the necessity for crypto-asset service providers to comply with anti-money laundering and counter-terrorist financing regulations.

EU's Regulatory Landscape

The European Securities and Markets Authority (ESMA) is advocating for expanded powers to oversee major European stock exchanges and financial infrastructure, positioning itself as the EU's counterpart to the US Securities and Exchange Commission (SEC). ESMA's chair, Verena Ross, has proposed a phased approach to enhance its authority, aiming to create a more unified capital market within the EU. This initiative seeks to streamline financial regulations and reduce fragmentation across member states.

Impact of US Policy on EU Regulations

The recent support for cryptocurrencies by US President Donald Trump has raised concerns within the EU regarding the potential attraction of crypto firms to the US market. Industry executives fear that the US's crypto-friendly policies could undermine the EU's regulatory framework, known as MiCAR, which is set to take effect on December 30, 2024. The EU's efforts to establish a comprehensive regulatory environment for digital assets may be challenged by the US's more favorable stance towards cryptocurrencies.

Conclusion

In response to these developments, Italy's central bank and securities regulator are engaging with crypto firms to strengthen regulatory safeguards. This collaboration aims to ensure the stability and integrity of the financial system amid evolving global policies on digital assets.

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