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7 Major EU Countries to Go Big on Blockchain: What It Means for Crypto

Last Updated October 5, 2020 4:35 PM
Joseph Young
Last Updated October 5, 2020 4:35 PM

On December 4, seven EU countries led by Malta and France have established a group called the “Mediterranean seven” to encourage and promote the usage of blockchain technology.

In the months to come, the seven countries that include France, Italy, Spain, Malta, Cyprus, Portugal and Spain, will work to implement the blockchain in education, transport, mobility, shipping, Land Registry, customers, company registry, and healthcare.

The declaration obtained by FT read :

“This can result not only in the enhancement of e-government services but also increased transparency and reduced administrative burdens, better customs collection and better access to public information.”

Will This Affect Crypto in Any Way?

Malta, the home of Binance, the world’s largest cryptocurrency exchange, has mostly been forward-thinking and open-minded in approaching digital asset and blockchain regulation.

Its flexible and practical regulatory frameworks have led major cryptocurrency-related businesses to migrate to the region throughout the past 11 months.

The involvement of Malta in the initiative could result in a positive effect on the European cryptocurrency sector as a whole, as it indirectly demonstrates the approval of the other six countries in the declaration of Malta’s efforts in facilitating the growth of the local cryptocurrency market.

The formation of the Mediterranean seven follows the call of the G20, a forum of government officials that represent 20 of the largest economies in the world, to monitor and regulate cryptocurrencies as an asset class and the market surrounding it.

Malta’s innovation minister Silvio Schembri, who has played a vital role in transforming Malta to the “Blockchain Island,” said:

“Malta is the first world legislator to offer a regulatory environment for all blockchain technology. We are not only interested in cryptocurrencies.”

The blockchain is the base technology of cryptocurrencies but open blockchain protocols cannot be run without incentive systems, which are cryptocurrencies. The two cannot operate without one another and if a blockchain network operates without a native asset, it can only do so if its structure is centralized.

As the group explores the potential of the blockchain and begins integrating it into various areas of the European economy, native digital assets could naturally come around and consequently, the European nations could integrate more practical regulatory frameworks pertaining to the asset class.

Already, France has approved  an initial coin offering (ICO) regulation in September to become Europe’s first ICO hub.

At the time, France’s Finance Minister Bruno Le Maire said that the government hopes the newly established legal framework for ICOs will attract investors from all around the world.

Europe’s Struggle

Despite the efforts of several European nations like the U.K. and Malta, Europe has struggled to compete against the U.S., Japan, South Korea, Singapore, and Switzerland for several years.

Most of the global market’s cryptocurrency exchange volume is heavily concentrated in three countries, the U.S., Japan, and South Korea, and the majority of blockchain-related businesses have relocated to Japan and Singapore in the past year.

Apart from Malta and Switzerland, most of the Europe’s regional cryptocurrency markets remain significantly weak when compared to Asia and the U.S.

The Mediterranean seven could reignite the cryptocurrency and blockchain ecosystem of Europe, if the regulators begin to provide a friendly environment for startups.

Featured image from Shutterstock.