German Politicians Push For Legal Framework for Cryptocurrencies

Most recently, German parliamentary representatives have put forth new suggestions for an appropriate legal framework for cryptocurrency trading as well as token granting, as they believe it would encourage the industry’s domestic development.

Politicians Recognize the Potential of Blockchain

The proposal was suggested at a public hearing hosted by the Bundestag’s Finance Committee on March 11th. The latest public hearing was scheduled to discuss the opportunities that blockchain can offer the country and how to turn it into a financial and business hub.

Union parties’ Antje Tillmann and colleague Matthias Hauer brought up the subject as they believe that Germany should not be left behind as blockchain begins to change the nature of finance in the coming years. According to their statement, whilst the industry is still in its nascent phase, they believe that blockchain technology is bound to make a significant and effective impact as a base technology for national digitization strategies across multiple fields, therefore the groundwork for its future implementation should be laid today.

In their joint appeal, they brought up both the current as well as the future state of the industry.

Both representatives reassessed the government’s projects up until now and commended their efforts for supporting pilot projects across the electro-mobility sector as well as electricity trading projects and projects for the Federal Office for Migration and Refugees.

Germany Doesn’t Want to Miss Out on the Trend

However, Tillman and Hauer stated that the efforts of the government should be increased. With an increasing outflow of blockchain startups to European as well as non-European countries, financing rounds (ICOs) are taking place almost exclusively abroad. Presently, ICOs are not fully regulated in Germany, and are generally treated as securities by regulators yet there is no clear rule on how to create an ICO in Germany so far.

Respectively, creating a good environment for startups to operate in the country, would lead to more investment and more opportunities for Germany to become a leader in the field.

Tillmann and Hauer claimed that in order to stay at the forefront, the government needs to lay out clear regulations for cryptocurrency and token trading to crypto trading, stating that “the potential of blockchain technology can only be fully realized if there is legal certainty and potential risks are mitigated. The goal must be to retain the entire added value of this promising technology in Germany and to develop our country into a pioneer of the blockchain economy.

Meanwhile, Germany’s justice and finance ministries have come out with a proposal to launch a state-run register to regulate the blockchain sector and protect investors from possible abuses. It is expected that the government will introduce a nationwide blockchain strategy within the first half of 2019.