It’s in the air now: supranational institutions have smelled the blood of cryptocurrency and they are preparing – after hesitations and indecision that have been going on for years – to go on the attack with a framework of new principles and rules. Thus, after the FSB of the G20, the ECB, the central bank of the European Union, is now also taking action.
New risks to financial stability are increasing and the cryptocurrency ecosystem has become more complex and interconnected. If current trends continue, cryptocurrencies will endanger financial stability. Cryptocurrency markets must therefore be effectively regulated and monitored. The cross-border and global nature of the ever-expanding universe of cryptocurrencies requires a holistic and coordinated approach between authorities
reads the latest Macroprudential Bulletin of the European Central Bank.
Like the FBS, the ECB researchers also mention the urgency of regulating the so-called stable coins, i.e. cryptocurrencies that on paper should not be subject to market fluctuations, as they are anchored to the value of other assets or fiat currencies, but which, paradoxically, can expose investors to even greater risks.
The Bulletin does not show interest in radically banning stable coins, when the (urgent) need to adopt a framework of European standards regulating these types of products also creates ad hoc regulatory bodies. to punish fraud and illegal conduct. In other words, the ECB wants to end the era of the Far West.
Meanwhile, the cryptocurrency market seems to be in trouble again. The Bitcoin it briefly dropped below $20,000 and reached $19,758. All major alt coins are bad too, with one exception: polygona cryptocurrency primarily used within the ecosystem of the same name designed for NFTs and DeFi.
Source: Lega Nerd
