European SEC creation urged by ECB president
Christine Lagarde, the head of the European Central Bank (ECB), has expressed the need for the European Union to establish its own version of the U.S. Securities and Exchange Commission (SEC), according to a report by the Financial Times. Lagarde believes that creating a European SEC will help attract the necessary funds to address the challenges of deglobalization, demographics, and decarbonization. Furthermore, she called for the abolition of national financial exchanges, stating that the European capital market requires consolidated market infrastructures.
Lagarde highlighted the significant disparity between the size of the US bond markets and those in Europe, as well as the vast difference in venture capital funding between the EU and the US. Despite the US economy being smaller than the EU, the volume of venture capital funding in the EU is only one-fifth of that in the US.
In related news, the European Parliament recently voted in favor of a law that licenses cryptocurrencies and regulates transactions. The legislation, known as the Markets in Crypto-Assets (MiCA) licensing mode, received a majority of 517 votes in favor, with 38 deputies opposing and 18 abstaining. Additionally, another law was passed with 529 votes in favor, which requires crypto operators to identify their clients in order to combat money laundering. Operators of cryptocurrency wallets and exchanges will now be required to obtain a license for their activities, and issuers of stablecoins will be obligated to maintain significant reserves.
As these developments unfold, it is clear that the European Union is taking steps to regulate the cryptocurrency market and strengthen its financial infrastructure.
