Source: Cointelegraph.com NewsThe European Securities and Markets Authority (ESMA) has warned that crypto will increasingly threaten traditional financial markets\u2019 stability as the industry grows and becomes more entwined with traditional finance players.
\n\u201cWe cannot rule out that future sharp drops in crypto prices could have knock-on effects on our financial system,\u201d ESMA\u2019s executive director Natasha Cazenave said in an April 8 statement to the Economic and Monetary Affairs Committee.
\nCazenave noted, however, that crypto currently only accounts for 1% of global financial assets and is not yet significant enough to cause major \u201cspillover effects\u201d into traditional financial markets.
\nShe warned that interconnections between crypto and traditional markets are rapidly growing \u2014 particularly in the more crypto-friendly US \u2014 and called for closer monitoring.
\n\u201cCrypto-assets markets evolve quickly, in an often unpredictable manner, and we need to keep a close eye on these developments,\u201d Cazenave said, adding:
\n\u201cTurmoil, even in small markets, can originate or catalyze broader stability issues in our financial system.\u201d
\nCazenave\u2019s concerns ranged from spot crypto exchange-traded funds and stablecoin use to hacks, scams and scandals \u2014 highlighting the recent $1.4 billion Bybit exploit and FTX\u2019s collapse in November 2022.<\/p>\n
Today in the ECON Committee, the role of crypto assets in relation to financial market stability was discussed. The European Central Bank (ECB) and the European Securities and Markets Authority (ESMA) were present.I raised a critical question about the digital euro.\u2026 pic.twitter.com\/KST7FRBhFF\u2014 Engin Eroglu (@EnginEroglu_FW) April 8, 2025<\/p>\n
The European Union has already implemented several measures to safeguard against crypto risks, most notably the Markets in Crypto-Assets (MiCA) regulation that was rolled out last year. Source: Cointelegraph.com NewsThe European Securities and Markets Authority (ESMA) has warned that crypto will increasingly threaten traditional financial markets\u2019 stability as the industry grows and becomes more entwined with traditional… <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5],"tags":[],"_links":{"self":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/126765"}],"collection":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=126765"}],"version-history":[{"count":0,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/126765\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=126765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=126765"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=126765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nWhile Cazenave said MiCA marked a \u201cbreakthrough\u201d for crypto regulation, she added that there is \u201cno such thing as a safe crypto-asset\u201d and that more rules may need to be implemented to mitigate future risks.
\nRelated: EU could fine Elon Musk\u2019s X $1B over illicit content, disinformation
\nHer comments come as both crypto and the stock markets have experienced double-digit falls over the last few weeks as the Trump administration continues to follow through on its tariff plans.
\nEurope lags US in crypto adoption
\nWhile crypto adoption has accelerated in the US, Cazenave noted that over 95% of European banks remain on the sidelines, with no involvement in crypto-related activities.
\nHowever, retail participation is on the rise, with an estimated 10% to 20% of European investors having crypto exposure, which is in line with growing global interest, Cazenave said.
\nMost reports measuring US crypto adoption suggest that the range of adoption is between 15% and 28% of the population.
\nMagazine: Financial nihilism in crypto is over \u2014 It\u2019s time to dream big againRead More<\/a><\/p>","protected":false},"excerpt":{"rendered":"