The EBA has been undertaking work in relation to virtual currencies (VCs) for some time, however, further to the request from European Commission Vice President Dombrovskis for the European Supervisory Authorities (ESAs) to carry out additional work to assess the applicability and suitability of current EU law to crypto-assets, and as outlined in the EBA’s March 2018 FinTech Roadmap, the EBA has carried out an additional analysis, the findings of which are set out in the report on crypto assets.
In the report, the EBA sets out a number of steps that it will take in 2019 to enhance the monitoring of institutions’ crypto-asset activities and consumer-facing disclosure practices, among which:
a) the development of a common monitoring template which competent authorities can issue to institutions, payment institutions and electronic money institutions (and, as appropriate, other financial institutions) to monitor the level and type of crypto-asset activity underway;
b) the assessment of business practices of institutions, payment institutions and electronic money institutions regarding crypto-asset advertisings (which should be well-balanced, clear and not misleading), pre-contractual information about the risks related to crypto-asset transactions for consumers (lack of legal framework, liquidity risk etc), and the disclosure of the rights and safeguards applicable to consumers in the context of any crypto-asset services provided by those institutions to assess what actions are needed to ensure high standards of consumer protection;
c) keep under review the need for any guidance to support a common application of the current prudential rules under the CRD/CRR as regards institutions’ exposures to/holdings of crypto-assets (ongoing);
d) carry out continuous monitoring of innovation and of the regulatory perimeter, including with regard to crypto-asset activities (ongoing).