Norges Bank has suggested that Norwegian authorities take active steps to regulate and control the cryptocurrency industry to support innovation. Paul Longva, deputy governor of the Bank of Norway, said that we should not wait for decisions from international regulators, but act quickly.
The report also suggests that existing European Union regulations regarding systemic risk and enforcement should be applied. It highlights the need for specific legislation relating to digital money and recommends that Norges Bank specialists increase their knowledge of the topic.
Countries around the world are closely watching the European Union's Crypto Asset Markets Regulation (MICA) law, which is due to come into force next year. European Central Bank chiefs have stressed the need for stricter regulations for the sector.
The fall of stablecoin issuer Terra and cryptocurrency exchange FTX has prompted EU regulators to take action and create rules for digital currency markets.
The MICA legislation affects all service providers in this area and is designed to prevent market abuse while ensuring investor safety, market reliability and financial sustainability. However, MICA does not cover "the area of decentralised finance, as the focus of monitoring is on centralised market participants".
