Italy Setting Up Crypto Environment That Meets EU's New Laws, Central Bank Governor Says
Italian regulators have begun setting up a supervisory environment anticipating European Union laws for regulating crypto, central bank Governor Ignazio Visco said in a speech on Saturday.
Visco spoke of the importance of regulating crypto, and outlined global, European and Italian initiatives underway during a speech on the global economic situation in Milan. Although the economies of Italy and the euro area are decelerating, because the sector's ties to traditional finance are weak, last year's crypto market collapse did not have any "systemic consequences" on "the real economy," he said.
He added that Bank of Italy surveys showed only about 2% of Italian households held "modest amounts, on average" of crypto and that the exposure of Italian intermediaries to the market was also very limited.
Nonetheless, the country's regulators are preparing for the forthcoming EU crypto rules under the Markets in Crypto Assets (MiCA) framework, which are due to be voted on for a final time in April. MiCA sets up licensing requirements for crypto issuers and service providers including exchange platforms. The central bank is working with local financial markets regulator CONSOB and the Ministry of Economy and Finance on setting up the "authorization and supervision activities" laid out in MiCA.
Italy had previously set up a mandatory registration requirement for crypto firms operating in the country, but, by the end of last year, the regulator responsible had not vetted the companies it had approved. As of Monday, the list had 91 virtual asset service providers.
The Bank of Italy is also working on various applications of distributed ledger technology (DLT) including the EU's own pilot for regulation of market infrastructures, according to Visco.
A distinction ought to be made between crypto "with no intrinsic value" that "divert resources from productive activities and collective wellbeing," the governor said. While these must be "strongly discouraged," innovations that can that can help improve the efficiency of financial systems should be fostered, he added.