Austrian Financial Authority Proposes Strict Regulation on Cryptocurrencies and ICOs

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According to a report, Board directors of the Austrian Financial Market Authority (FMA), Helmut Ettl and Klaus Kumpfmüller, have called for tighter regulation on Initial Coin Offering (ICOs) and digital currencies.

As per an article published on Jube 29, in the Austrian newspaper Die Presse, Klaus Kumpfmüller proposed a “threshold-dependent” prospectus requirement for ICOs similar to that of securities. The FMA executive committee defined a “reasonable” threshold as two million euros. Whats more, as per Klaus Kumpfmüller, there should be concession obligation for distributors of digital currencies and that these “will be treated like securities in the future.”

Helmut Ettl analyzed the proposed regulation to existing restrictions on financial institutions “For the purchase and sale of foreign currency you need a mini-bank license.” So far, digital trading currencies have no such analogous regulation under Austrian law; the FMA submitted around 30 statements regarding legal violations in connection with digital currencies and ICOs to the public prosecutor’s office.

As per the Die Presse, FMA Board members showed their dissatisfaction with Austria’s Finance Ministers, Hartwig Loger, who needs the agency of some of its authority. In regular disputes amid the FMA and the auditing authority (OePR), Loger calls for more “regulatory responsibility at the ministerial level,” which the FMA should then “reasonably execute.”

As per the FMA executive board, matter such money laundering have so far only been partially regulated by law, and further oversight by the ministry should be viewed as a positive development. Although there are “no serious problems” with regards to supervision and accounting, so a transfer of competences would possibly be regarded as “a political decision.” Helmut Ettl stated it was crucial that the FMA retains “integrated and independent supervision.”

Although, with regards to tightening regulation on digital currencies, the FMA and the Finance Minister are not so far apart. When Loger called stricter rules in the cryptocurrency sector in February, and for early regulation at the European level, both Klaus Kumpfmüller and Helmut Ettl accepted and offered their participation in a “FinTech Regulatory Council” recommended by Loger.

Nishanth Shetty

Nishanth Shetty is a technical writer, author and a crypto-advisor working at Cryptofame. Based in the city of dreams, Mumbai, on the west coast of India. He holds a bachelors degrees from Mangalore University. Nishanth has a myriad experience of technical writings for tech brands. His interests include technology, travel, and food.