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ECB president Lagarde yesterday in front of the EU Parliament: Crypto assets & DeFi have the potential to pose real risk to financial stability She also called for a The ECB has been analysing crypto-assets to identify potential implications for monetary policy, the smooth functioning of market infrastructures and payments, and the stability of the The European Systemic Risk Board (ESRB) published a report that outlines the systemic implications of crypto markets and proposes policy options to address the risks “MiCA II should regulate the activities of crypto-asset staking and lending, which are definitely increasing,” she stated in her function as the head of the European The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) today published a Joint Report on recent developments in crypto A week after the major American crypto lending platform Celsius had to freeze the withdrawal option for its users, European Central Bank (ECB) president Christine This shone a light on three extremely concerning aspects: the high vulnerability of the lending protocols; the extensive interconnections among crypto-asset Crypto-related investment products are now traded on some of the largest exchanges, with crypto-asset ETPs offered on exchanges such as the NYSE, the Nasdaq, Cboe and Xetra. For

ECB Chief Now Has Eyes on DeFi and Crypto Lending: What It Means for You

European Central Bank (ECB) President Christine Lagarde is turning her attention to the rapidly evolving world of Decentralized Finance (DeFi) and crypto lending, signaling a potential shift in regulatory focus. Concerns are mounting about the systemic risks these technologies pose, especially in light of recent events.

Lagarde Calls for Crypto Regulation Amid Growing Concerns

Addressing the EU Parliament yesterday, ECB President Lagarde stated that, "Crypto assets & DeFi have the potential to pose real risk to financial stability." Her comments underscore the increasing unease among financial regulators regarding the potential destabilizing effects of these emerging technologies.

The ECB has been actively analysing crypto-assets to identify potential implications for monetary policy, the smooth functioning of market infrastructures and payments, and, crucially, the stability of the financial system. The analysis comes as crypto-related investment products are now traded on some of the largest exchanges, with crypto-asset ETPs offered on exchanges such as the NYSE, the Nasdaq, Cboe and Xetra.

MiCA II: Targeting Crypto Staking and Lending

Lagarde believes stronger regulatory frameworks are needed. "MiCA II should regulate the activities of crypto-asset staking and lending, which are definitely increasing,” she stated in her function as the head of the European Central Bank. This suggests upcoming regulatory action specifically aimed at curbing the potential risks associated with these activities.

European Systemic Risk Board (ESRB) Sounds the Alarm

The European Systemic Risk Board (ESRB) recently published a report that outlines the systemic implications of crypto markets and proposes policy options to address the risks. This coordinated effort highlights the growing concern across various European institutions about the interconnectedness and potential vulnerabilities within the crypto space.

Celsius Freeze Highlights DeFi Lending Risks

A week after the major American crypto lending platform Celsius had to freeze the withdrawal option for its users, European Central Bank (ECB) president Christine Lagarde\'s concerns were amplified. This situation shone a light on three extremely concerning aspects: the high vulnerability of the lending protocols; the extensive interconnections among crypto-asset entities; and the overall fragility of the market.

Joint Report from EBA and ESMA on Crypto Developments

The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) today published a Joint Report on recent developments in crypto, further reinforcing the focus on increased monitoring and potential regulation. This collaborative approach indicates a concerted effort to understand and manage the evolving risks within the crypto market.

What This Means for Crypto Investors

The ECB\'s increased scrutiny of DeFi and crypto lending suggests stricter regulations are on the horizon. This could lead to increased compliance costs for platforms and potentially impact the availability and profitability of crypto lending services. Investors should stay informed about upcoming regulatory changes and carefully assess the risks associated with crypto lending platforms.

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