German Finance Authority Says Blockchain is Revolutionary, Explains Crypto Regulation Focus

German Finance Authority Says Blockchain is Revolutionary, Explains Crypto Regulation Focus

Felix Hufeld, chief of Federal Financial Supervisory Authority in Germany (BaFin) has revealed that the main role of crypto sphere regulators is not to protect individual investors but rather try to maintain the overall stability of the volatile markets. At the end of the day, investors need to look out for themselves, while authorities tackle systemic threats in the budding market.

Speaking at an event in Berlin he explained that, “That’s why we warned ICOs last November, pointing out the high price volatility of crypto-tokens. We will not be able to protect every single investor from his fate, and that cannot be the task of state supervision. Once again, the maxim is that we must act prudently or regularly if financial stability as a whole is threatened or if consumers are systematically harmed.”

While Mr. Hufeld was pretty skeptical towards cryptocurrencies, likening bitcoin to a bubble, he seemed particularly positive towards distributed apps and the underlying blockchain technology, powering them. Hufeld claimed that “blockchain could actually be revolutionary”, also adding that, “These apps are not only safe from failures of individual computers or providers, they also promote the development of a blockchain economy.”

Even though the BaFin president also labelled blockchain as a ‘disruptive’ technology , he expressed a belief that its full potential is far from being fully implemented. Hufeld also mentioned at outspoken crypto critic Bill Gates, who described Internet as overhyped in 1991, only to recognize its enormous potential for innovation a bit further down the road.

According to him, “The disruptive potential of this technology, however, goes beyond saving costs. Completely new business models could emerge that neither you nor I think of today. And every day, many people are working to find further uses for the blockchain and to use the technology over a large area.”

The speech is a suitable follow-up to Hufeld’s remarks back in April, when he reassured that his agency does not want to “kill blockchain” amid increasing efforts by BaFin to regulate digital currency trading, citing money laundering and terrorist financing concerns.

Image Source: “Flickr”

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