Key facts:
Although there are advances, there are still skeptical positions towards bitcoin in the Bank of Spain.
KPMG suggests a regulatory and control framework for cryptocurrencies.
The audit services firm KPMG in Spain, presented a report that puts the Hispanic country ahead of the rest of the European nations, with respect to the regulations on bitcoin (BTC) and other cryptocurrencies.
KPMG assures in an analysis entitled New horizons before the expansion of crypto assets, that the vision of the Bank of Spain on cryptocurrencies has changed from 2018 to date. At the time, they argued that they had a low level of adoption, volatility and link to criminal activities.
Currently, regulations have advanced in Spain, to such an extent that banks and exchanges that operate with cryptocurrencies in that country must register with the highest Spanish monetary entity, a fact reported by ..
This shows how Spanish regulators have gradually adapted to the changes, driven by the massive adoption of bitcoin by individuals and institutions.
Despite the progress, the firm consider that in the Bank they still “coexist from skeptical positions towards more critical and analytical positions on the implications of the expansion of crypto assets in the financial environment.”
KPMG is one of the four largest professional services firms in the world, also known as the Big4, along with PwC, Deloitte and Ernst & Young.
Cryptocurrencies are here to stay
Generally speaking, KPMG’s analysis notes that cryptocurrencies cannot be considered as something temporary.
Therefore, they argue that the growth in the adoption of bitcoin and other cryptocurrencies impacts the global financial sector, “Opening a range of new opportunities and challenges.” Given this, they consider it necessary to “establish a control and regulatory framework that guarantees adequate institutionalization.”
A KMPG executive believes that cryptocurrencies open a range of new opportunities and challenges to the global financial sector. Source: elements.envato.
According to the audit firm, apart from the fact of variations in the price of cryptocurrencies, they ensure that people’s interest in crypto assets it has experienced “steep growth since last year.”
Much of this growth is based on speculative expectations, in which the general public observes that a new class of assets is emerging and, without deepening the understanding, begins to act so as not to miss a possible opportunity, although in turn, it is also It owes to the entry of institutional investors who are beginning to understand its great potential.
Álvaro Casado Pérez, director of FS Consulting Strategy at KPMG in Spain.
Later in the writing, Álvaro Casado, executive of the firm, considers that cryptocurrencies are part of a “new reality” for the traditional financial system and other sectors of the economyTherefore, they must “be approached from the understanding of the possibilities it offers and not from the prohibition”.
Given this statement, the executive gave as an example decentralized finance (DeFi), Play to Earn protocols, as well as the burgeoning market for non-fungible tokens (NFT), which, together, have limited use cases but which have a potential to develop, according to Casado.
KPMG’s view on CBDCs
Another aspect of the KPMG document is related to central bank digital currencies (CBDC) and the assessment being made by the European Central Bank (ECB) for a possible issuance of the digital euro.
“The issuance of CBDCs could be the instrument for governments to operate in this new market,” said Casado.
Among the advances of the digital euro, this medium reported that the ECB recently appointed the members of the Market Advisory Group. These are 30 high-level professionals who will advise the Eurosystem on the design and distribution of that asset.
Faced with all these advances in the world of cryptocurrencies, Casado added that society is beginning to face a “new paradigm” of how money is understood and financial actors will be forced to adapt.
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