In the latest years, financial regulators of the EU and Great Britain have been progressively issuing new regulatory requirements for cryptocurrencies. It is, therefore, inevitably necessary to monitor all the recent changes. Especially this assumption would be relevant for those who are planning to register a crypto company in the EU or in Great Britain. We will now shortly summarize the latest developments in this sector.
As it was stated in the 2018 report of the working group created by the FCA, the British main financial regulator started applying certain measures aiming at direct regulation of digital assets in Britain. The report was mainly focused on describing cryptoassets, defining them, and explaining the DLT technology.
Some of the key steps that the FCA has organized are:
- Releasing a statement of the working group concerning cryptoassets and DLT;
- Publishing a mission statement describing the FCA findings;
- Arranging a consultation about the applicability of the current regime to specific cryptoasset types.
Constructing their results on Britain’s current legislation, the working group came to the conclusion that cryptoasset should be classified as property. This conclusion is important to consider for individuals and companies conducting cryptocurrency activities. Therefore, it means that smart contracts can be qualified as legally binding if they conform to the general principles of the contract legislation.
Regulation in the EU
The new market participants of the EU crypto business sector can find useful the recommendations of the EBA and ESMA. The first organization, EBA, is responsible for AML practices and monetary rules application to cryptoassets. The second one, ESMA, is debating whether the financial instrument regulations should be applied to virtual assets, too.
When it comes to France and Malta, these countries invented specific legislation governing cryptoasset transactions. Luxembourg’s legislation applies special rules to authorize storage for security tokens on designated platforms. The government of Luxembourg also might add the concept of a “token” to the legislative framework.
5AMLD was implemented in Finland and Croatia. Consequently, these countries can use a single consolidated act to expand the financial regulation of cryptoassets. In Poland legislation allows JSCs to store shares in DLT software.
For everyone opening a cryptocurrency exchange in the EU, it is crucial to consider that all members of the exchange would adhere to the concept of “investment activities”. Moreover, starting cryptoasset project in the EU can be generally challenging. The main reason is the fact that the legislative framework adopted there earlier did not take into account technological innovations take cryptoassets for example.
Contacting COREDO would be the perfect decision for everyone planning to establish a crypto company in the EU. We will help you with navigating local legislation, recent requirements applied to virtual assets, and registration conditions. Registering a crypto business in Great Britain is also in our competence.