Welcome to another astounding edition of our Veriscope Regulatory Recap! This week we cover ECB’s plan to regulate crypto under online gambling laws, Israel’s Securities regulator's actions to bring crypto under its oversight, and the Moroccan Central Bank governor’s announcement on the country’s first draft of crypto regulations. Let’s dive straight into it.
The European Central Bank is comparing cryptocurrencies with gambling in its blog of Jan. 5th, 2023, citing the speculative nature of unbacked virtual assets.
ECB advocates for building efficient “guardrails that address regulatory gaps and arbitrage” in the crypto world, which according to the Bank, will reduce the social costs of the crypto asset.
That said, the ECB admits that introducing regulations could be like walking a tightrope. This is why it insists that while making people aware of the crypto market’s loopholes, it must not introduce poor regulation and broken models.
For their implementation, the EU’s “Regulation on Markets in Crypto-Assets” is considered the main tool along with regulations in all industry segments, including crypto-asset lending and non-custodial wallet services.
Overall, the overarching goal of the ECB is to have regulation with a global reach to prevent regulatory arbitrage.
According to Israel’s securities market watchdog, crypto assets are often used for investment and, therefore, should be covered under its oversight.
The ISA suggests legislative amendments to extend the existing securities laws to digital assets.
While justifying its advocacy for regulation, the ISA cites the need for protecting investors and tackling crypto-asset risks.
The document has now moved into an intermediate phase for public feedback and comments. It will remain open until mid-February and will wait another six months for their eventual transition into final approval.
Morrocco’s first-ever crypto bill is ready to be discussed with several industry stakeholders, according to Abdellatif Jouahiri, the Governor of Morocco’s Central Bank, Bank Al-Maghrib.
The draft bill aims to define crypto and its role within the country’s context and protect consumers without throttling innovation.
While the Central Bank has collaborated with the IMF and the World bank to prepare the document, it will discuss it with other regulators, including the Moroccan Capital Markets Authority (AMMC), the Insurance Supervisory Authority and Social Security (ACAPS), etc.
Morocco is the fastest-growing crypto-user economy in Northern Africa. The percentage share of the country’s population owning digital assets increased from 2.4% in 2021 to 3.1% in 2022.
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