The German Federal Ministry of Finance has revealed its stand on cryptocurrency securities regulation in a recently released paper talking specifically about blockchain securities regulation.
The paper which was published on March 7 revealed that the German Federal Ministry of Finance is in favor of blockchain securities regulation. The document points out that electronic securities regulation should be technology-neutral. This means that the regulation of such securities should be carried out on Decentralized Ledger Technology (DLT) or blockchain technology.
“In view of the fact that the technical standards and requirements can change rapidly, authorization should be provided to regulate the specific technical details by legal regulation,” stated the German Federal Ministry of Finance in the release.
The German authority did, however, note that the electronic securities regulation should initially start with electronic bonds before moving to other digital securities. It also added that the market is not yet ready to handle the regulation of electronic shares although that should be expected in the future. The regulator claims that cryptocurrency tokens should not be subjected to the currently existing market regulations. This is because they are not classified as securities or financial instruments in accordance with the Securities Trading Act.
Germany to introduce blockchain strategy
The German government’s chief executive body recently announced that it plans to introduce a blockchain strategy for the country before mid-2019. The government body which is known as the Cabinet of Germany also revealed plans to carry out an online consultation before they introduce the blockchain strategy.
Germany’s Ministry of Economic Affairs and the Ministry of Finance will be tasked with preparing the blockchain strategy although other relevant ministries are expected to contribute some input. The issue of crypto and blockchain related regulation has been a hotly debated subject especially as cryptocurrencies and digital assets gain popularity. Germany’s decision to introduce blockchain-securities regulation highlights the fact that it recognizes the role of such digital securities in the future. It also recognizes the need to come up with proper regulation that will provide guidelines and introduce protective measures to make them safe for users.