German BaFin official calls for EU-wide DeFi regulation

Wednesday 18 May 2022 15:05 CET | News

Birgit Rodolphe, executive director at Germany’s Federal Financial Supervisory Authority (BaFin), has called for uniform regulation of the decentralised finance (DeFi) space throughout the European Union.
In an article on BaFin’s website, Rodolphe warned of the risks to consumers of the unregulated DeFi space and called for standardised regulatory considerations across EU member countries:
The official cited risks to consumers of technical issues, hacks, and fraudulent activity that have seen millions lost and claimed that DeFi isn’t as democratic and altruistic as its fans say and that DeFi products are difficult for many to grasp. She concluded that DeFi protocols aren’t at liberty to operate outside of regulations simply because they use new technologies:

Lending, borrowing, insurance and other products outside of the traditional financial system are subject to licensing and supervision where they’re offered, and called on regulators to set rules which will give DeFi providers legal clarity, according to the BaFin offcial.

BaFin is Germany’s financial regulatory body responsible for regulating banks, insurance firms and financial institutions including cryptocurrency companies. BaFin is the issuer of crypto custody licenses, a permit required for firms wanting to offer cryptocurrency services within Germany.

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Keywords: BaFin, regulation, DeFi, cryptocurrency
Categories: DeFi & Crypto & Web3
Companies: BaFin
Countries: Germany
This article is part of category

DeFi & Crypto & Web3


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