Cryptocurrency-based exchange-traded products (ETP) giant 21Shares is asking European Union authorities to create a more comprehensive regulatory framework. 21Shares is a key player in consultations in the region as it is one of the largest crypto fund issuers in the region.
Regulatory Inconsistency
21Shares complains about the legal inconsistencies that exist between Europe’s member states. While some UCITS funds are allowed to hold crypto assets, others are prohibited from such transactions.
The regulations put into effect after long-term work will cause many cryptocurrencies, including Tether, to stop their services due to not receiving an e-money license in the region. Coinbase announced that it will only offer licensed stablecoins such as PYUSD and USDC to citizens in the region by the end of the year.
Expectation of Clear Guidance from ESMA
The company recommends the creation of clear guidelines from the European Securities and Markets Authority (ESMA) to be implemented in all EU entities. It is stated that this step will increase investor protection.
21Shares emphasizes that if European markets align with Hong Kong and US markets, several crypto ETPs will be approved.
“The uncertainty of the current regulatory structure prevents retail investors from accessing the full potential of crypto assets. “ESMA’s provision of regular rules could create new opportunities for investors to diversify their portfolios.”
Mandy Chiu, Head of Financial Product Development at 21Shares, highlighted the importance of a consistent regulatory stance for Europe to become a leader in financial innovation. This type of regulation could encourage further growth and development in the crypto-asset space while increasing market stability and investor protection.
Conclusion
21Shares’ request is considered an important step in terms of wider acceptance of crypto ETPs within the EU and protection of investors. Clear regulations can ensure the stability of the crypto market, allowing the development of innovative financial products.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
