Cryptocurrencies, the ECB: "Harmonizing the rules for banks"
The European Central Bank aims to create a single code of conduct on how credit institutions offer virtual currency to their customers in the EU area. The US Federal Reserve: "We closely monitor the sector and the related risks"
18 Aug 2022
Create a single code of conduct for all banks in Europe that want to offer cryptocurrency-based products to their users. This is the goal announced by the European Central Bank, which aims to harmonize with its supervision the methods and approaches of individual credit institutions in this matter, making sure that they have the economic resources and skills necessary to operate in a sector that has been repeatedly defined by insiders as a "Far West".
The choice was necessary to give a set of indications common to all credit institutions and all national regulators on how to adopt cryptoassets, pending a legislative initiative that will still take several months to see the light, and to give banks operating in different countries of the Union a univocal reference framework, also to protect savers and investors.
"In Germany - reads a note from the ECB - some crypto-assets are subject to obtaining a license, and more than one bank has asked to be able to obtain these authorizations: in this context the European Central Bank is taking all the necessary steps to harmonize the issuance of these licenses", assessing whether the crypto-assets are from time to time in line with the risk profiles and with the need to set aside capital required. At the same time, the ECB aims to assess whether the banks in question can correctly identify risks and whether they have "solid experience" in the field.
"Working closely with national supervisors, the European Central Bank will strive to develop greater consistency on prudent measures across all national regimes."
Meanwhile, a similar stance from the Federal Reserve comes from the United States, which has warned banks of the risks associated with involvement in the crypto-asset sector. While the sector presents "potential opportunities" for lenders, in fact, according to the Fed, it is also worth taking into account the fact that "activities related to crypto-assets can also present risks related to security and solidity, consumer protection and financial stability".
So the Fed says it is engaged in careful monitoring of the sector, and has stressed that banks that want to engage in the sector must submit their plans to the authority, verifying the legality of such activities before undertaking them.