Abstract
Based on the guidelines issued by the European Securities and Market Authority and by the European Banking Authority, the article deals with the legal qualification of blockchain-based crypto-assets under EU law. Focusing on crypto-assets that function as a) investment instruments (that is, investment tokens) and as b) electronic money (that is, payment tokens), the work outlines shortages and drawbacks in the applicability and enforcement of existing EU legal frameworks regulating investment activities and payment services. With such analysis, the article seeks to inform the ongoing debate within European institutions on the need of regulatory intervention in this area, and it points out pressing questions to be tackled by further research.
Highlights
Blockchain technology, with its fundamental proposition of transparency and cryptographicallysecured systems of rights’ enforcement, has fuelled hyped attention across many areas, spanning from trade to copyright protection
The most widespread and disruptive innovation introduced by the technology remains so called cryptocurrencies and, more in general, the possibility to create units of value that circulate on a world-wide, peer-to-peer digital network
Rooted into open-source cultures, the raise of blockchain-based financial networks expresses a neo-libertarian response to the post-2008 crisis of trust in political and financial institutions.[1]
Summary
Blockchain technology, with its fundamental proposition of transparency and cryptographicallysecured systems of rights’ enforcement, has fuelled hyped attention across many areas, spanning from trade to copyright protection. To understand how to support the development of the industry while ensuring appropriate legal oversight, European as well as National Competent Authorities (NCAs) have opened public consultations and issued extensive reports on crypto-assets.[14] On one side, legislators are willing to encourage the ‘token economy’ as a positive ‘long-term trend’, avoiding burdensome regulation that could jeopardise the industry and displace the market for investments On the other, they recognise that legal safeguards and regulatory certainty must be in place, to guarantee investor protection and to ensure a sustainable development of businesses and of the whole ecosystem.[15]. To determine the legal treatment of a token, it is necessary to adopt a ‘substance over form approach’ that looks at its actual functions in specific circumstances and moments in time.[23]
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