The current crypto market scenario has alarmed regulators across the globe calling for more clarity regarding regulation and simultaneously effective implementation of the existing legislation. The market has also seen various personalities and organizations pour in their opinions like predictions, suggestions, etc.
Recently, Mark Branson, President of the Federal Financial Supervisory Authority (BaFin), the financial regulator in Germany and member of the supervisory board of the European Central Bank (ECB) presented his views on the topic.
In an interview published by the ECB on Thursday, Branson criticized the crypto market sector citing its ongoing struggles following the recent collapse of several big-shot companies and prolonged bear phase.
According to him, the crypto sector has innovations to offer but is often exploited by actors whom he referred to as “freeloaders and crooks” as not every business model is serious and sincere. Further, he said that these actors also increase the threats and risks associated with the digital assets sector, especially in the case of investment opportunities.
However, Branson also acknowledged the fact that currently the crypto market does not pose a threat to financial stability but as the sector evolves and becomes more interconnected with financial institutions like banks and venture capital funds and hedge funds, the situation would not be the same as it is now.
Belonging to a regulatory organization, Branson believes in optimum and flexible regulation of the sector. He calls for regulation of the sector in a manner that should be excessive nor too lenient saying that excessive regulations obstruct the pace of innovation. The framework should be such that it allows sincere and efficient projects to succeed and benefit the customers.
Branson also revealed that there are a limited number of banks enthusiastic to offer crypto-asset trading services in Germany. Germany is also one of the best crypto-regulated countries given the minimal number of crypto companies in its jurisdiction. However, most of the European nations would now adhere to the European Union’s Markets in Crypto Assets (MiCa) bill.