Over 40 cryptocurrency firms have written to the European Union, urging them not to enact punitive crypto legislation that would cripple decentralized networks that provide financial services.
According to Reuters, on the 13th of April, over 40 cryptocurrency organizations sent a document to 27 Ministers of Finance in the international body, requesting that the laws do not go beyond those already in place and implemented by the Financial Action Task Force, which is meant to curb money laundering.
Jean-Marie Mognetti, the CEO of CoinShares, and Diana Biggs, the CSO of Decentralised Finance Technologies, collaborated on the drafting and distributing of the letter. Mognetti informed the media that the EU’s laws for governing digital products are more difficult to understand than those in other nations, making it difficult for crypto firms to operate in Europe.
The European Union Rushes To Regulate The Crypto Sector
The EU, following in the footsteps of other countries across the globe, aims to impose stringent rules on the digital currency industry, which has undergone great development and expansion at a rapid rate in recent years.
Presently, the international body is lagging behind the United Kingdom and the United States in the establishment of legislation for the cryptocurrency sector, which has recorded over $2.1 trillion in turnover.
Early last month, European Union legislators approved new laws that would allow regulators in the continent to track down transactions done using BTC and other virtual currencies. If these guidelines are enacted, crypto exchange companies and other organizations operating in the cryptocurrency area will be required to gather and store information about participants in cryptocurrency transactions, along with their personal information.
The Cryptocurrency Business Soars Despite Regulatory Constraints
From the vote in April, about 46 leaders and companies in the crypto industry released a petition declaring that the new policies will exert risks on each entrepreneur of cryptocurrencies because all information of daily transactions and wallet addresses would be divulged and made available to the entire public under the proposed legislation. Also, owners of cryptocurrencies will be subjected to a greater risk of identity theft and physical harm.
The referenced petition from the cryptocurrency world also requests that DeFi networks be exempted from the need to identify as legal organizations under the MiCA regulatory system, a sample of which was approved by the European Parliament last month. In the paper, cryptocurrency supporters also request that some stablecoins should not be part of the MiCA bill.
Recent regulations proposed by the international body in recent months have threatened the anonymity and decentralization of of crypto sector as the body seeks to reduce financial fraud conducted using cryptos.