An Executive Board Member of the European Central Bank (ECB), the financial institution responsible for administering monetary policies within the Eurozone, has opined that financial watchdogs across the globe must now fast track the process of regulating bitcoin (BTC) and other blockchain-based digital assets, as more and more institutions like Facebook join the bandwagon, reports Bloomberg on July 7, 2019.
Regulators Must Act Fast
Per sources close to the matter, European Central Bank Executive Board member, Benoit Coeure has warned that top financial regulators across the world, including the United States Securities and Exchange Commission (SEC), must now take the issue of cryptocurrency regulation more seriously and implement robust policies to govern the burgeoning industry as soon as possible.
Speaking from the Aix-en-Provence in Southern France on June 7, 2019, Coeure opined that since tech giants such as Mark Zuckerberg’s Facebook, as well as other institutions, are beginning to catch the crypto fever, it has become quite crucial for regulators to up their game, to be prepared for the revolution.
“It’s out of the question to allow them to operate in a regulatory void for their financial service activities because it’s too dangerous. We have to act quickly than we’ve been able to do up until now.”
Crypto Exposing Deficiencies in Traditional Finance
As reported by BTCManager earlier in June 2019, social networking whale Facebook released the whitepaper and wallet for its Libra cryptocurrency.
The move triggered much criticism from regulators and some cryptocurrency market participants alike, with Rep.Maxine Water, calling on Facebook to freeze the development of Project Libra until a hearing is conducted.
Interestingly, Coeure has opined that the development of digital currencies has started exposing the weaknesses and failure of the traditional financial system, as well as deficiencies in existing regulation.
“Crypto projects are a rather useful wake-up call for regulators and authorities, as they encourage us to raise some questions and improve the way we do things,” he concluded.
With the nomination of crypto-friendly Christine Lagarde to replace Mario Draghi as president of the ECB on November 1, 2019, it is expected that the outgoing International Monetary Fund (IMF) chief will pay more attention to regulating the nascent digital asset industry than her predecessors.