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Cryptocurrencies remain extremely popular, and it may soon become easier to conduct transactions using them. This is the result of an ambitious proposal by EU authorities.
The European Securities and Markets Authority (ESMA), the EU’s financial regulator, wants to include cryptocurrencies in the wider investment landscape of European countries. It is considering increasing the value of cryptocurrencies 12 billion euros. The portal reported this Farnborwhich refers to guide Issued by ESMA.
In this context, the Authority is looking at potential commitments by Undertakings for Collective Investment in Transferable Securities (UCITS) that could diversify their portfolios, among other asset classes, into: CryptocurrencyIn its guidance published in May, ESMA initiated discussions with industry experts to gather insights and opinions on the feasibility and possible impact of the inclusion of cryptocurrencies in UCITS.
UCITS are usually composed of mutual funds, exchange-traded funds Stock Trading Or money market funds that are governed by EU regulations. However, they also attract investors from outside the EU who are trying to gain a foothold in the European market.
Do you invest in cryptocurrencies?
Stakeholders have until August 7 to submit comments, which could pave the way for UCITS to become one of the largest general funds with exposure to crypto assets.
UCITS and ETFs are different
There are indeed products that allow trading in cryptocurrencies. These are, for example, Bitcoin exchange-traded funds (ETFs), which offer the opportunity to invest directly in cryptocurrencies. So, unlike UCITS, it is just one fund focused on cryptocurrencies. In the case of UCITS, we are talking about the inclusion of multiple cryptocurrency funds with different allocations.
Such a strategy would fall within existing EU regulations that prohibit the creation of fully autonomous, cryptocurrency-focused investment vehicles. We will see how it affects the price. Bitcoin. introduce Exchange Traded Funds In March 2024, the price of Bitcoin in the United States hit a new record of over $73,000.
This novelty can also facilitate the overall management of cryptocurrencies. At the same time, it can increase legal certainty for businesses and support the increase of regional invest.
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