In response to the European Union’s crypto-related regulatory framework, the World Exchange Federation (WFE) called for clarity between the classifications of digital assets and crypto-assets.
“We believe there could be value in adopting a single EU classification which covers both: digital-assets and also crypto assets, as a subcategory,” the WFE wrote in response to questions posed in a report.
Blockchain and crypto have been around for just over a decade, so there is still development of terminology and regulation around the space. Bitcoin, stablecoins and other assets are currently being labeled by the public as anything from digital assets to magic internet money.
Similar uncertainty was also confronted by the regulation around this new industry. In the writing-up of the WFE, to avoid confusion, the organization referred to these as crypto-assets.
WFE Wants Global Application
The document noted that the WFE wants to adapt its crypto terminology to changes and rulings in the global industry. The WFE said:
“Whilst a more universal classification would be welcome in the crypto asset taxonomy, it will be important to consider this in an internationally applicable manner and to have the suitable flexibility within that classification to mould to international classifications as they develop.”
Such clarity, the organization said, would improve EU collaborations within itself and across other regions around the world.
“It is important that definitions should aim to facilitate greater clarity on the types of asset that already fall within the regulatory perimeter and the type of platforms where they are available,” the WFE said, emphasizing the importance of avoiding technical terms that may rapidly become outdated.
The organization also said the chosen terms should carry behind them the associated regulatory guidelines.
The subject of standardizing the cryptocurrency language has attracted much interest around the world. A congressman recently introduced a bill in the United States proposing a comprehensive scheme for the division of all digital assets into three categories.
The WFE has pushed against the ban on the trading of crypto derivatives, which the Financial Conduct Authority of the United Kingdom, or FCA, considered restrictive in 2019.