European Commission intends to curb the volatility of cryptocurrencies
Europe can independently set volatility limits
Traditional stock exchanges work in a similar way
This method of work is probably already tacitly practiced by some exchanges.
International consortium of news organizations developing transparency standards.
European lawmakers are studying the issue of limiting the volatility of cryptocurrency assets, as is already practiced on traditional stock exchanges
The European Commission initiated the development of regulation of the cryptocurrency market in order to solve the problem of volatility of digital currencies. This is reported by the news agency Sputnik with reference to the Vice-President of the European Commission Valdis Dombrovskis.
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It is noted that the European Commission considers the lack of regulation of the crypto market to be a problem due to the “potential risk” that virtual assets like bitcoin and Ethereum can pose..
Dombrovskis’ task is to develop transparent regulation for the EU with clear wording.
Contain the market
However, it is probably not worth waiting for special innovations. According to the experts of the Bank of Latvia, European legislators can take a path similar to the regulation of the traditional financial market.
According to the expert on payments of the Bank of Latvia Klavs Ozolins, the European Commission can empower itself to set the maximum level of volatility of cryptocurrency assets, just like it works on traditional stock exchanges.
“I think that the introduction of such an already existing instrument in the field of crypto assets would definitely help to put things in order,” said Ozolins.
It is worth noting that some exchanges in the cryptocurrency market seem to be secretly practicing a similar scheme..
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Earlier, the co-founder of the Morgan Creek Capital cryptocurrency fund, Jason Williams, said that under the guise of disruptions in the service during bursts of Bitcoin volatility, the American popular Coinbase exchange is trying to imitate stock exchanges, namely, the New York Stock Exchange (NYSE).
Let us remind you that every time there are sharp ups or downs in quotations on the exchanges, and panic arises on the market – exchanges, as a rule, resort to forced stops of trading..
In the case of the NYSE, the exchange introduced a special trading stop mechanism in 2010..
According to Dombrovskis, the European Commission is not going to integrate virtual assets into the daily flow of payments. Cryptocurrencies will continue to exist at the level of speculation.
Unified regulation of cryptocurrencies in the EU is planned to be introduced by 2024.
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