• EBA calls for a unified approach in creating crypto asset rules
• Crypto assets  are not adequately covered by existing EU financial rules
• EBA supports FATF’s recommendations on cryptocurrency regulation  

The European Banking Association (EBA) is calling for bloc-wide rules on cryptocurrencies. This call comes soon after a similar one for ICO and crypto regulation by the European Securities and Markets Authority (ESMA).

Existing financial frameworks not enough

The London-based European Banking Authority (EBA), the regulatory agency for the European Union, urged the European Commission in a report published Tuesday to explore the possibility of implementing unified crypto rules across their region.

According to the agency that drafts EU legislation, the existence of independent crypto laws across the European countries could easily be abused and lead to the exploitation of consumers and investors.

The EBA report added that activities relating to crypto-assets were not covered by the existing EU financial laws which made them highly risky, and asked the commission to undertake a comprehensive analysis to determine the action at the EU bloc level. EBA’s executive director Adam Farkas stated:   

“The EBA’s warnings to consumers and institutions on virtual currencies remain valid. The EBA calls on the European Commission to assess whether regulatory action is needed to achieve a common EU approach to crypto-assets. The EBA continues to monitor market developments from a prudential and consumer perspective.”

Money launderers having a field day

EBA’s call to action follows an expression of concern by the Financial Action Task Force (FATF) about the weak crypto asset laws money launderers could easily exploit that. The global financial regulator stated last October it would put trying to mitigate the risks associated with crypto-enabled money laundering as one of its priorities in 2019. The agency went further to ask individual nations to hasten their regulation of crypto service providers such as cryptocurrency exchanges, wallet services and ICO projects.  FATF president Marshall Billingslea said:

“By June, we will issue additional instructions on the standards and how we expect them to be enforced.”

While EBA supports the commendations made by FATF, it is seeking dependable intra-governmental monitoring and reporting for crypto-related financial crimes. The agency also wants to see a broader approach taken to mitigate the impact of cryptocurrency mining on the environment due to the huge amounts of computing power required and energy.

Another European regulatory authority, the European Securities and Markets Authority (ESMA) urged the EU, council and parliament in their report on Tuesday to carefully consider sealing the existing regulatory gaps. ESMA Chair Steven Maijoor said:

“The existing rules were not designed with these instruments in mind, NCAs face challenges in interpreting the existing requirements and certain requirements are not adapted to the specific characteristics of crypto-assets.”