Brussels is taking a “soft touch” approach to regulating blockchain as it explores the technology’s applications across government services.
The European Commission is approaching blockchain with “acceptance and support but a healthy degree of caution” said Romanian member of the European Parliament Sorin Moisa speaking at an event in London in Tuesday.
He also said that a warning on initial coin offerings issued by the European financial watchdog earlier this month and which said they would be treated as securities would not apply to utility tokens. These differ from cryptocurrencies in that they facilitate a transaction rather than having an intrinsic value in themselves.
An EU Observatory will launch early next year, said Moisa, to monitor the opportunities and risks of the technology, as well as identify areas where it could be put into use by the European Commission, such as procurement or VAT reporting.
The commission will also launch a pilot project next year, focused on using blockchain for financial reporting as well as a white paper discussing the technology.
“There is both fascination and bewilderment in Brussels with blockchain. Awareness however is growing. There’s a drive to understand, to pilot and experiment, and also to regulate,” he said.