Danish Regulator to Ban Unhosted BTC Wallets
The Danish Financial Supervisory Authority (DFSA) is working to eliminate unhosted Bitcoin (BTC) wallets as part of its Decentralized Finance (DeFi) guidance.
Danish Bitcoin Wallet Ban Complies with MiCA Regulation
The regulator is concerned about the activities of unregulated platforms in the crypto space. The DFSA prominently emphasizes the need to regulate all crypto platforms and service providers, including interface providers and mobile application developers.
Normally, the use of unregulated interfaces violates legislation contained in the upcoming CryptoAsset Market (MiCA) regulatory framework. There are only a few days left until the rule is partially implemented. This requires all crypto initiatives in the European Union to be regulated before then.
As a result of Denmark’s move, no crypto exchange or trading platform will no longer be able to offer Bitcoin wallets, DEX interfaces or other crypto-related products to Danish customers. The only exemption would be if they are regulated in Denmark.
Two weeks ago the European Banking Authority (EBA) completed the draft of technical standards on prudential matters under the MiCA regulation. This involved ensuring that all firms in the EU adhered to high financial standards.
Some of the changes include changes to equity funding requirements, changes to liquidity provisions, and very stringent bailout plans for crypto asset issuers. The MiCA regulation in particular affects stablecoins pegged to the US Dollar.
Will MiCA Destroy Crypto?
Several market watchers and major crypto players consider these rules to be quite strict.
Mikko Ohtamaa, who reported on Denmark’s ban on unhosted Bitcoin wallets The DFSA may have good intentions, but Ohtamaa doesn’t think “over-regulation” is the right approach.
“Forcing everyone to be a regulated intermediary in a peer-to-peer world sounds good, but you can be honest in your conversations and say: “We actually want to ban all cryptocurrencies, we’re just being sneaky about it.” Ohtamaa, known for his connection to the Trade Protocol, wrote about X: “Because that’s the bottom line.”
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Benjamin Godfrey is a blockchain enthusiast and journalist who enjoys writing about real-life applications of blockchain technology and innovations to ensure mainstream acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain-based media and sites. Benjamin Godfrey is a lover of sports and agriculture. follow him excitementLinkedIn
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