European regulator warns cryptocurrencies could threaten financial stability

Odaily Planet Daily News Natasha Cazenave, executive director of the European Securities and Markets Authority (ESMA), told the Economic and Monetary Affairs Committee on April 8 that as the cryptocurrency industry grows and deepens its ties with traditional financial institutions, a sharp drop in crypto prices in the future could have a chain reaction on the overall financial system. Although crypto assets currently account for only 1% of global financial assets and have not yet constituted a major "spillover effect", they are developing rapidly, especially in the crypto-friendly US market. The European Union has implemented the Crypto-Asset Market Regulation Act (MiCA) to deal with risks, but Cazenave emphasized that "there is no absolutely safe crypto asset" and more rules may be needed to reduce future risks. Currently, about 10%-20% of European investors hold crypto assets, while 95% of European banks have not yet entered this field. (Cointeleraph)