European Parliament: cryptocurrency Central banks will “change the rules of the game” on the stock market
The latest study of the European Parliament was designed to study competition in the FINTECH sector and commissioned by the parliamentary Committee on economic and monetary Affairs. In the study, it was found that the electronic currency issued by Central banks, can become the guarantor of the legal protection of users, in the absence of a competition policy to protect the rights of users in the cryptocurrency sector.
“Emission of cryptocurrencies, the financial institutions and the Central banks will increase the current level of competition in the market digital of financial assets”.
In the study mentioned bitcoin as the “technological and operational paradigm of the cryptocurrency environment, which is also an innovative driving force for the entire sector of the traditional economy, including monetary policy and financial stability”. The other “innovative technologies” include “AI, cloud computing, biometrics, digital identity, the blockchain, cybersecurity, RegTech, the Internet of things (IOT) and augmented reality”.
According to the study, since private cryptocurrencies require the controlling party, the Central banks can be seen as validators in the framework of closed-cryptocurrency system, “complementing, controlling, or replacing” existing cryptocurrencies.
The study argues that crypto-currencies from the Central Bank, “will be able to change the current nature of competition in the cryptocurrency market” by providing reliable alternative:
“The inadequacy of the traditional competitive model in the context of the stock market can be changed through direct participation of large financial institutions by issuing its own cryptocurrency”.
Problems of competition, as noted in the study, can be divided into problems of “interceptable market” (competition between cryptocurrencies), and “Intra-cryptocurrency market” (competition between providers of digital services, wallets and exchanges.
It is reported that “the presence of network effects” the first cryptocurrency can become an obstacle to market entry other digital assets. The study assumes that the existing intercongolese “can lead the market to a potential monopoly and the formation of a hypothetical cryptocercidae.
In the framework of competition in the market interceptability, wallets, exchanges and payment providers, using certain privileges, can create unhealthy conditions, restraining the new company from participation and development in this field.
Earlier, in the beginning of the month, German solarisBank, one of the first representatives of a traditional financial system of Europe, has proposed opening “accounts for blockchain-companies.”
Recall that to curb the growing trend of attacks on cryptocurrency exchanges and offenses in the sphere of digital payments, Europol is going to hold a series of meetings with the largest European bitcoin exchanges. The purpose of the meeting is to develop more aggressive ways of combating crime in the trade of digital assets.
Subscribe to Bitnovosti telegram!
Share your opinion about this news in the comments below.