European Union Releases an “Enabling Framework” for Blockchain and Fintech

The European Commision, the executive arm of the European Union, released their official take on an “Action Plan” regarding how to regulate fintech and blockchain technology. The new initiative will see to the participation of EU-level officials, national authorities, and technology providers in Europe, to form a new FinTech Lab by Q2 2018.

The bodies will come together for the purpose of improving the “regulatory and supervisory capacity and knowledge” involving new technologies such as blockchain. Maruya Gabriel, Commissioner for the Digital Economy and Society, stated, “Technologies like blockchain can be game changers for financial services and beyond. We need to build an enabling framework to let innovation flourish while managing risks and protecting consumers.”

The Commissioner also goes on to say that the “Action Plan” will focus on the delivery of best practices on regulatory sandboxes, whose guidelines are to be set by the European Supervisory Authorities. Besides this, other areas of focus will be the already mentioned, creation of an EU FinTech Lab, along with a Blockchain Observatory.

Also, attention will be given to cybersecurity efforts and to promoting digitization of information gathered from registered companies. Licensing schemes related crowdfunding are also under discussion with Commissioner Valdis Dombrovskis claiming, that the new regulations will help “scale up” crowdfunding platforms.

Besides all these, the report goes on identifying areas of possible development and addresses legal clarification of smart contracts, ICOs. Jurisdictional issues raised by techs, and so on. Overall, the plan allows the EU to nurture the potential of blockchain technology all the while pertaining to a regulatory environment.

Other advancements that have been made by the European Union in this regard would be its revision of the Payment Service Directive, that was done in January. The revised set of instructions requires bank operating in the region to open up their communication channels, like APIs to blockchain applications in need of payment account integration.

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