The industry’s current focus is on cryptocurrency law, particularly in the European and American markets. The U.S. and the European Union (EU) are researching methods to use blockchain technology to make utilizing money increasingly simpler while also protecting investors as these markets continue to expand. The use of cryptocurrency to cross-border payments is one aspect that is of special interest internationally. It is really attractive to think of utilizing cryptocurrency to move money across international borders. However, several European financial specialists claim that the state of the cryptocurrency does not permit the project to continue to be profitable. Let’s look at the most recent cryptocurrency news.
The EU has worked diligently to pass regulations governing cryptocurrency. The committee of countries has started a variety of research to better understand how investors may be impacted by the widespread use of cryptocurrencies, both favorably and unfavorably. The substantial bundle of crypto infrastructure rules approved in early July is the result of their efforts.
The European Central Bank (ECB) has released another report with a focus on cross-border payments as part of its ongoing efforts. More and more crypto investors are turning to the DeFi market as a substitute for foreign payments made via banks as a result of the rising interest in cryptocurrencies like Ripple (XRP-USD). For starters, these programs charge far lower rates than those imposed by conventional wire transfers. As a pioneer in this field, Ripple has an advantage because its project complies with ISO 20022. The banking language standard ISO 20022 is quickly replacing all other communication protocols for banks. With its entry into this market, cryptocurrency has even another advantage over traditional bank transactions.
Crypto News: The ECB Is Wary of Using Several Cryptocurrencies for Cross-Border Payments
The ECB’s study on foreign money transfers is the main topic of today’s government cryptocurrency news. Many applaud the area as the answer to current bureaucracy. The bank is clear that not all cryptocurrencies are suitable for the position, however.
Cryptocurrencies are ranked as the least suitable replacement for cash transactions in the assessment by the EU banking regulator. The analysis claims that BTC is one of the worst cross-border payment options to embrace on a large scale, which will come as no surprise to anybody save the most devoted Bitcoin (BTC-USD) maximalists. This is partly because to its consensus proof-of-work algorithm. The EU has shown that it opposes cryptos that use the resource-intensive consensus mechanism via its infrastructure bill.
Investors find the ECB’s lack of confidence in stablecoins as a workable wire-transfer currency more unexpected. Because of reserves, this is possible. Regulators don’t appear to have much confidence in currencies that function as reserves for other assets. According to the research, adopting these stablecoins as the norm would give private corporations an excessive amount of market power. According to CoinDesk, the increased number of private stablecoin projects, such as the unsuccessful Diem project by Meta Platforms (NASDAQ:META), is the reason for the attention placed on these cross-border transfers.
However, despite the fact that solutions like Ripple exist and are well-known for their usage in cross-border payments, the ECB is choosing a different, far more centralized approach. According to the analysis, Central Bank Digital Currencies (CBDCs) are the best choice. Of course, this is the most logical conclusion that a central bank can reach. However, it acknowledges that the absence of CBDCs at the moment means that the end of conventional transfers may be some time off.