The European Union (EU) will introduce a new set of rules within the next four years to promote quicker and cheaper cross-border payments through the use of blockchain technology and cryptocurrency.
This development was revealed in two (2) documents by the European Commission where it sets out its strategy to encourage digital finance in the region.
“By 2024, the EU should put in place a comprehensive framework enabling the uptake of distributed ledger technology (DLT) and crypto-assets in the financial sector,” the documents said. “It should also address the risks associated with these technologies.”
“…By 2024, the principle of passporting and a one-stop shop licensing should apply in all areas which hold strong potential for digital finance. Instant payment systems should become the “new normal” by the end of 2021.”
According to the EU, the commission is keen on adopting efficient “instant” payment options due to the need for cashless payments as highlighted by the COVID-19 pandemic lockdowns.
A further look at the document shows that the commission will also present a draft law to clarify existing rules which apply to crypto assets, and outline new rules to fill any gaps in its regulation.
Ultimately, the EU will have its major crypto focus on Stablecoins which many central banks in the region are currently studying whether to launch theirs.
The Commission hopes to move towards “home grown” digital payment alternatives, with less dependence on US payment firms like Facebook Libra, MasterCard, and Visa – which are most commonly used for instant transactions in the region.