The European Securities and Markets Authority (ESMA) has launched a call for evidence to discover information regarding the newest developments in digital currencies, such as Bitcoin, or the associated Blockchain technology.
The European regulator had been monitoring and analyzing the investments related to virtual currencies for the past six months, and has presented its analysis and understanding of the digital currencies and the underlying blockchain or ledger-based technology in the paper.
Through this paper, ESMA is hoping to receive notable feedback from industry experts, existing financial institutions, new start-ups or the associated technological advisers, and issuers and advisers in order to understand how the Bitcoin technology can be used to “issue, buy and sell and record ownership of securities.”
“ESMA is interested in how different virtual currencies and the associated blockchain, or distributed ledger, can be used in investments. There are now facilities available to use the blockchain infrastructure as a means of issuing, transacting in and transferring ownership of securities in a way that bypasses the traditional infrastructure for public offer and issuance of securities, trading venues like exchanges and central securities depositaries or other typical means of recording ownership.”
In the paper released, the watchdog asks 10 questions about the virtual currencies and the dependent assets, apart from the benefits and the risks associated.
The contributions can be submitted on ESMA’s website under the “Your Input – Consultations” tab before July 21st 2015.
The regulator has not provided any details of how it intends to utilize the received information. However, it can be safely assumed that the regulator may be looking into the Bitcoin technology in order to make the European financial markets more transparent. Adoption of this technology in mainstream finance will prove to be a huge positive for the digital currency ecosystem.