The report is authored by Mariana de la Roche, David Phillips, Laura Kajtazi, Anja Raden and Tom Jansson at The IOTA Foundation.

Report name

Bridging the gap between technology and regulation with dialogue

Who wrote this report?

The IOTA Foundation is a global non-profit that develops next-generation decentralized technology to enable digital autonomy for everyone. It collaborates with a global ecosystem of partners to research and develop technologies that deliver sustainable, real-world impact. Together, they are shaping a new digital economy, removing unnecessary friction and unlocking human potential.

FTI Consulting Brussels is an advisory firm that specializes in strategic and integrated public affairs communications services advising multinational companies facing business-critical political, policy, regulatory or reputational challenges on how to engage with stakeholders, including politicians, NGOs and the media in Brussels and beyond.

Introductory Text

The report “Bridging the gap between technology and regulation with dialogue” is based on a series of roundtable policy discussions on cryptocurrencies, blockchain technology and digital assets, organized by the IOTA Foundation with FTI Consulting.

The goal of the discussions was to facilitate a balanced and fact-based approach to blockchain regulation by helping policymakers gain an understanding of the technology and appreciate the blockchain industry's needs.

The report highlights the challenges faced by EU regulators in understanding and keeping up with the rapidly evolving blockchain and crypto industry. It emphasizes the need for an open dialogue between policymakers and industry players to address legislative and regulatory needs while fostering innovation. It makes the case for small players to be included in these conversations to ensure a diverse range of perspectives and prevent the dominance of large players.

The report presents a summary of the discussions held during the events, including key pain points and recommendations for industry and policymakers. It reflects the willingness of both industry and policymakers to collaborate and drive innovation while safeguarding consumer rights.

Best quote

“These roundtables help to demystify the legal landscape surrounding blockchain technology. By breaking down complex concepts, exploring case studies, and sharing practical experiences, the events promote clarity and increased awareness among participants. The deep dive into legal considerations fosters a more informed and educated community that can navigate the intricacies of DLT confidently.”

Key takeaways:

  • **Understanding the dynamic nature of the industry: **the report highlights the challenge regulators face in keeping up with the rapidly evolving blockchain and cryptocurrency industry, emphasizing the need for ongoing dialogue to stay informed and adapt regulations effectively.
  • **Inclusivity and consideration of small players: the **report underlines the importance of including small players in regulatory conversations, ensuring their voices are heard alongside larger industry players, and promoting a fair and inclusive regulatory framework.
  • **Balancing innovation and regulation: **the report states the need for a delicate balance between fostering innovation and implementing necessary regulations. It highlights the importance of regulatory clarity, global harmonization, and flexible frameworks that support responsible growth, address risks, and protect consumers in the blockchain industry.

What’s in this report?

The report presents the findings from four roundtables organized by the IOTA Foundation. The events brought together industry experts and policymakers to engage in dialogue, exchange insights, and propose solutions. Discussions covered topics such as self-hosted wallets, tokenization, NFTs, and the impact of regulation on SMEs and startups.

The events covered by the report are:

  • Increasing Trust, Accountability, and Ease-of-Use in Self-Hosted Wallets with SIS and Reusable KYCs.
  • The Future of NFT Regulation: NFT Beyond Art.
  • Tokenisation and the Real Economy.
  • The Cost of Regulation and Uncertainty for SMEs and Startups.

Each chapter includes a background to the topic under discussion, the insights of the participants, and a concluding summary.

Also included is an overview of the current regulatory landscape, an executive summary, and biographies of all participants.

Why should you read this report?

By reading this report, you will gain a deeper understanding of the complexities, challenges and uncertainties surrounding the industry and the need for collaborative efforts between regulators and industry stakeholders to navigate this ever-changing landscape effectively. The report also provides valuable insights into the opinions of those responsible for regualting the European blockchain industry. Specifically, these policy makers are:

Barbara Brandtner, Director for Financial Services, Directorate General for Competition, European Commission; Ernst Ferdinandusse, Senior Expert in Antitrust at the Payment Systems Unit in DG Competition, European Commission; Marius Kat, Head Parliamentary Assistant to MEP Paul Tang (SnD, NL), European Parliament; Peter Kerstens, Special Advisor for Technological Innovation and Cybersecurity at the Directorate-General for Financial Stability, Financial Services and Capital Markets Union, European Commission; and Joachim Schwerin, Principal Economist in the Unit responsible for the Digital Transformation of Industry within the Directorate-General Internal Market, Industry, Entrepreneurship and SMEs, European Commission.

Who is this report for?

The report is recommended for a diverse range of readers, including regulators, policymakers, industry professionals, legal and compliance experts, researchers, and advocacy groups. Whether seeking a comprehensive understanding of the industry, navigating regulatory complexities, conducting research, or advocating for industry interests, this report serves as a valuable resource for individuals and groups involved in the blockchain and cryptocurrency ecosystem.

🔗 Read the full report here. 🔗

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