EU to spend €1 million on cryptocurrency and fintech industry regulation

The European financial markets regulator has set aside one million euro with the aim to spend it on crypto and fintech oversight activities in 2019, according to Annual Work Program, developed by the European Securities and Market authority (ESMA) on September 26.

The document outlines the regulator's key priorities and contains the information about proposed budgets and regulatory activities in different areas of ESMA's responsibilities.

ESMA's highest priority is to ensure investment protection and promote stability of the financial markets.

When it comes to digital asset markets and fintech industry, the EU watchdog is focused on monitoring financial activities and retail investor trends to identify risks and challenges in a timely manner and coordinate regulatory efforts across the region, promoting best practices and proposing actions if necessary.

"The monitoring also helps ESMA to play a proactive role in market intelligence gathering and to develop metrics that will guide the Authority in determining when and where ESMA will employ its own product intervention power. Furthermore, monitoring activity enhances the capacity to fulfil the responsibility to ensure that NCAs’ use of the power is co-ordinated and coherent."

The budget for these activities in the amount of 1,107,360 will be spent for establishing an ongoing monitoring of investor trends, financial activities and innovation and for ongoing gathering of market intelligence data by efforts of six full-time employees.

Earlier this year ESMA warned investors about potential risks in buyin digital currencies such as Bitcoin, citing extreme price volatility and clear signs of a price bubble as a principal reasons for concerns.

Since that time Bitcoin volatility dropped dramatically to the lowest level sice May 2017, according to Bitcoin Volatility Index.