ESMA cryptocurrency

European Watchdog ESMA Budgets 1.1 Million Euros to Monitor Fintech and Crypto

Oct 5, 2018, 9:23PM
1 min, 21 sec READ

The European financial watchdog ESMA has allocated over a million euros towards a market study of crypto assets and fintech.

The European Securities and Markets Authority (ESMA), which regulates and legislates securities in the European market, has allocated 1.1 million Euros towards the monitoring of fintech and digital assets, as detailed in the 2019 annual work program report released by the body. 

The budget will fund regulatory and supervisory processes for emerging fintech and cryptocurrency related activities. One key objective is described as,

Achieve a co-ordinated approach to the regulation and supervisory treatment of new or innovative financial activities and provide advice to present to the EU institutions, market participants or consumers. 

ESMA's Crypto Focus

ESMA was established in 2011 and is seen as an “EU-wide financial markets watchdog”. Earlier this year, the regulatory body imposed restrictions on the leverages offered for contract-for-differences (CFDs), with cryptocurrency CFDs limited to a maximum of 2:1. They stated that “CFDs with cryptocurrencies as an underlying [asset] raise separate and significant concerns.” 

As the crypto industry is still largely unregulated, the ESMA is looking to identify issues and risks related to the market in order to establish what a regulatory framework will look like. While definitive conclusions are likely to take time, the increased scrutiny should bring some clarity with regards to the European approach to crypto regulation. Many investors welcome the news as innovation, business opportunities, and funding in the cryptosphere have generally moved away from regions where regulators have been wishy-washy about the status of digital assets. 


Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.