New German Coalition Calls for Strong European Authority for Crypto
A newly formed German coalition has given cryptocurrency a place in the country’s new agenda as it calls for a new “dynamic in relation to the opportunities and risks from new financial innovations,” for example crypto assets and blockchain businesses.
From December, left-leaning Social Democrats (SDP), the Green Party and the right-friendly Free Democrats will be in charge of the West European country with over 80 million citizens. The forming of the ‘team’ took almost two months and marks the end of Angela Merkel’s 16-year reign who will be replaced by the SDP’s Olaf Scholz
The 177-page(turning) coalition agreement released on Wednesday, it is stated that:
“We are making European financial market supervisory law fit for digitization and for complex group structures in order to ensure holistic and risk-adequate supervision of new business models.”
The document also calls to strengthen European authority on the crypto space:
“We need joint European supervision for the crypto sector. We oblige crypto asset service providers to consistently identify the beneficial owners.”
The document specifies that the European Union supervisory authority should “not only take care of the traditional financial sector but also prevent the misuse of crypto values for money laundering and terrorist financing.”
In August this year, a law came into effect that allows Germany’s institutional investors to invest up to 20% of their total assets in Bitcoin (BTC) and other cryptocurrencies via their Spezialfonds. Considering the total assets under management of all Spezialfonds in Germany, a full 20% allocation would have a potential of $415 billion entering the crypto market.
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Author: Peter Siu