The European Union Commission has called for an extensive study of decentralized finance (DeFi). Following the major milestone on crypto regulations in the EU, the European Commission has now set its eyes on DeFi regulation. For this, the EU Commission has submitted its bid to monitor the DeFi by looking at Ethereum data.
The pilot study aims to develop and test an in-built technology to supervise activities within DeFi space. The study will involve researchers who will be tasked with the job of gathering supervisory data directly to monitor DeFi activity in real time.
The tender value of the study is likely to cost 250,000 euros, and it may take about 15 months to complete.
What’s the objective of the study?
According to Circle Director of EU Policy Patrick Hansen, the study could prove to be impactful as the capability of regulatory bodies. This would allow them to automatically monitor compliance by reading public blockchain data.
The members of the European Parliament passed the MiCA bill into law on 10 October. The landmark legislation will create a comprehensive regulatory framework for digital assets in the region. This is also aimed at marking guidelines for crypto companies and protecting crypto investors.
While the news of crypto regulations gathering pace in Europe may be pleasing for the investors, it may add to the burden for the service providers. The service providers will have to remain vigilant, and if regulations are set in place, they may also reveal information about the transactions.
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