Europe and stablecoins, beginning of mad love? – No one is supposed to ignore MiCA (Markets in Crypto-Assets), a plan responsible for framing the use of cryptocurrencies adopted at the beginning of October last. At least with a few exceptions. Indeed, it is difficult to resist the temptation to use these digital currencies called stablecoins. So why wait? European market operators will soon be able to have fun thanks to a brand new pilot scheme. All the details.
Stablecoins, here we come!
In their tank filled with newly tokenized sand, European bankers will be able to try to manipulate a whole new kind of asset. Tokenized financial products. Let’s not play on words, in short, cryptos. Indeed, an initiative of a completely new kind has just been approved by the European Commission. This is the pilot plan DLT (Distributed Ledger Technology). Simply put, it is a transitional regulatory framework allowing certain market players to use ‘distributed ledger technologies’. Of the stablecoinsquoi.
This pilot will allow them to use stablecoins for interbank exchanges and settlements without waiting for the implementation of MiCA. A planned implementation at best for 2024. So a lot of waiting for a new toy that is very desirable it must be said. Immediate international transfers at a lower cost, hard to resist for a banker.
Players in traditional and digital finance will be able to experiment with these new types of exchanges within a regulated environment. Ceci, from March 2023 and for a period of 3 years, renewable once. It will also provide concrete insight into the use of distributed ledger technologies within financial markets for future mainstreaming.
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Crypto sandbox in European finance
Participants in the DLT pilot project will thus be exempt from certain very specific parts of the financial services regulations. This concerns in particular the Markets in Financial Instruments Directive (MiFID) and the Central Securities Depositories Regulation (CSDR).
Newcomers to the financial markets, not licensed with MiFID and CSDR, will also be able to apply for the DLT project. The oldest bank in the United States, BNY Mellonwas particularly interested.
It is done. Cryptocurrencies, or at least their stable counterpart, are now making their way into the highest echelons of European finance. Good or bad, time will tell. But the practicality of the blockchain in interbank exchanges has been known for a long time. It was indeed high time for Europe to look into the subject. Small downside all the same given the enthusiasm, it is very surprising for the European Union that it does not yet have a stablecoin euro worthy of the name. Euro stablecoin currently issued by Circle, an American company….
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