Two new European Union documents have proposed a four-year window for incorporating crypto assets into the E.U.’s payment infrastructure. The documents include plans for the E.U. executive to put forward a law to iron out any regulatory kinks and if necessary create new regulation for crypto adoption in the E.U.
New Rules To Bring Regulatory Clarity
According to Reuters, the European Commission is especially keen to press ahead with crypto adoption because the pandemic lockdowns exposed a failure point in the existing cash-dominated order. To this end, the EC believes that switching to instant payments is now a priority.
In order to achieve this, according to the Reuters report, the EC will put forward draft legislation that will provide a comprehensive regulatory framework for distributed ledger technology (DLT). The proposed legislation will also plug crypto’s regulatory gaps in E.U. law where they may exist.
An excerpt from the document quoted by Reuters reads:
“By 2024, the E.U. should put in place a comprehensive framework enabling the uptake of distributed ledger technology and crypto assets in the financial sector. It should also address the risks associated with these technologies. By 2024, the principle of passporting and a one-stop shop licensing should apply in all areas which hold strong potential for digital finance.”
European Digital Payments Growth Ambitions
The report mentions that the EC intends to integrate the new set of regulations within its existing “same risk, same rules, same regulation” pan-E.U. framework. In so doing, the report says, within four years, customers should be able to access digital instant payment solutions immediately, once Anti-Money Laundering and Know-Your-Customer checks are completed.
As part of the crypto regulation program, the report says, the EC will also monitor customer transaction costs to make sure that they do not exceed those of regular transfers.
It will be recalled that earlier in 2020, a consortium of 16 European banks announced a partnership for a homegrown European payment system that would be up and running by 2022. This system was supposed to provide an alternative to American behemoths VISA and Mastercard.