The European Securities and Markets Authority (ESMA) is responsible for promoting investor protection, orderly markets and financial stability. At a blockchain conference last week in London, Patrick Armstrong, Senior Risk Analysis Officer, detailed ESMA’s approach to blockchain technology. One strategy he noted was to ban blockchain products or processes altogether.
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ESMA Has the Power to Ban Blockchain
For both regulators and market participants, the issue of blockchain technology and its regulatory response is “a critical topic,” Armstrong said. “When confronted with a financial innovation, a regulator can roughly take one of three approaches,” he explained.
The first approach, which Armstrong called the “restrictive approach” is to ban or restrict products and processes based on blockchain technology. He said:
The first, banning, is a power that