The European Commission is introducing legislation that, they say, should bring clear legislative frameworks and protection for users to the cryptocurrencies sector. On September 24, they officially adopted a new package of laws covering digital finances, retail payments, as well as laws directly related to cryptocurrencies. They also pay special attention to stablecoins.
In the document, the EC aims to require companies that emit stablecoins with a total value of more than EUR 5 million to obtain permission from the competent authority. They also want to oblige companies to publish a whitepaper that contains details about the project. Exemption from this process will be given to small and medium-sized companies whose total value of cryptocurrency supply does not exceed EUR 1 million per year. With this exception, they seek to ensure that the claims on such companies are proportionate to the risks associated with the services they provided.
According to the office, the legislation is crucial to support the recovery of the EU economy, as they bring companies new financing opportunities. It concerns in highly innovative digital companies.
The new legislation will not bypass Slovakia either. On September 17, the Slovak parliament passed a collection of laws that also regulate the cryptocurrency sector - companies providing electronic wallets and exchange services. They also define digital currencies as such.
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Electronic wallet provider definition
"Virtual currency wallet service provider means a person who provides services for the protection of private cryptographic keys on behalf of its clients, for the holding, storage, and transfer of virtual currency"
Anyone familiar with how cryptocurrencies and e-wallets works know that various web platforms (or applications) only serve as a gateway through which the user communicates directly with the blockchain. This is the place where cryptocurrencies are "stored". The definition of what providers offer to their users would therefore deserve further consideration. Among other things, the legislative introduce conditions for cryptocurrency companies similar to those that banks, for example, must meet (especially in the area of AML).
In general, we consider this amendment as positive - it is good that the state understands the need to deal with cryptocurrencies and also that it seeks to protect users from various types of frauds. On the other hand, such amendments might deserve a wider debate with the professional public, so as not to unnecessarily complicate the operation of companies in the market. Time will tell us how this amendment will be enforced in real life.