European Authorities Issues a Warning over the Future of Cryptocurrencies
European Authority have released a warning over the future of cryptocurrencies, saying it could be obstructed by the central banks.
On Friday, European Parliament issued a research study on the basis of “Competitive issues that Sector of Financial Technology (Fintech)” is facing. The European Parliament Committee on Economic and Monetary Affairs [ECON] was in charge to accomplish this study. They supervise the decisions taken by the EU’s European Central Bank (ECB).
The document was revealed that if the bank authorities were to release their own digital currency. Since it could be the end for the existing cryptocurrencies.
The Authors of the publication at the Police Department A: Economic and Scientific Policy wrote,
“The arrival of permission cryptocurrencies promoted by banks, even by central banks, will reshape the current competition level in the cryptocurrency market, broadening the number of competitors.”
“However, the market power of banks in traditional banking services might be used to limit competition in the cryptocurrency market through pre-emptive acquisitions or predatory pricing schemes.”
The report by ECON presents the cryptocurrency analysis; also, the document explores the future of personal finance, banking, insurance, wealth management, and forex.
What does the Study say?
However, there are only five mining pools to control 79% of the bitcoin mining industry. According to the study, the international nature of cryptocurrency markets seems challenging with regards to the European issued policy.
The Author in the report added on,
“Europe leads, at international level, the supply of wallet and exchange services, with 42% and 37% in terms of number of players. It is also the principal actor in payments (33%). Nevertheless, the main weakness of Europe is the concentration of the mining activity on non-European countries (Europe only captures just 13% of the current mining market).”
The EU policy accompanies a paper from the Financial Stability Board (FSB) – an international financial watchdog. Finally, last week FSB announced, that currently, cryptocurrencies are not a threat to the global financial system. For the first time, cryptocurrency was considering at the ECON session on “Monetary Dialogue”.
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Image Source: European Parliament
