The Danish Financial Supervisory Authority (DFSA) is working in direction of abolishing unhosted Bitcoin (BTC) wallets as a part of its Decentralized Finance (DeFi) steering.
Denmark Bitcoin Wallet Ban Aligns With MiCA Regulation
The regulator is anxious concerning the actions of unregulated platforms within the crypto house. Markedly, the DFSA emphasizes the necessity for all crypto platforms and repair suppliers together with interface suppliers and cell app builders to be regulated.
DENMARK TO ABOUT TO BAN BITCOIN WALLETS
We have lastly reached this level.
In the newest DeFi steering of Danish FSA, the regulator goes too far: The steering tries to seize every thing in crypto regulation, together with your Bitcoin pockets, utilizing “interface” argument. DFSA says… pic.twitter.com/F7jFuLhNqC
— Mikko Ohtamaa (@moo9000) June 26, 2024
Ordinarily, the usage of unregulated interfaces violates the laws embedded within the upcoming Market in Crypto Asset (MiCA) regulatory framework. The partial implementation of the rule is just a few days away. This necessitates that each one crypto ventures within the European Union are put so as earlier than then.
As a results of Denmark’s transfer, no crypto exchanges or buying and selling platforms would have the ability to supply Bitcoin wallets, DEX interfaces or every other crypto-related merchandise to Danish prospects anymore. The solely exemption could be for them to get regulated in Denmark.
Two weeks in the past, the European Banking Authority (EBA) accomplished the draft of the technical requirements for the prudential issues as per the MiCA regulation. This concerned guaranteeing that each one the companies within the EU adhere to the excessive monetary requirements.
Some of the amendments embrace change in personal funds necessities, adjustments in liquidity provisions and really strict restoration plans for the issuers of the crypto belongings. Notably, the MiCA regulation impacts stablecoins particularly these pegged to the United States Dollar.
Will MiCA Squeeze Crypto Out of Existence?
A number of market observers and key crypto gamers opine that these guidelines are relatively inflexible.
Mikko Ohtamaa who reported Denmark’s ban on unhosted Bitcoin wallets on X, prompt that the foundations in MiCA are outlined to squeeze digital belongings out of existence, a sentiment that Gary Gensler, the Chairman of the Securities and Exchange Commission (SEC) holds. The DFSA’s intention could also be good, however Ohtamaa doesn’t suppose “overregulation” is the precise strategy.
“Trying to force everyone to be a regulated intermediate in a peer-to-peer world sounds cool, but you might as well be honest with your talking points and say “In reality we want to ban all cryptocurrencies, we are just sneaky about it” as a result of that is the end result,” Ohtamaa, recognized by his affiliation with the Trading Protocol wrote on X.
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