EU’s ESMA Amplifies Crypto Regulations: A Deep Dive into Enhanced Scrutiny

A New Era of Scrutiny for Crypto Transactions

The European Union and its securities regulator, ESMA, are tightening the reins on the cryptocurrency sector. This week, ESMA announced a public tender, aiming to gather detailed trading data on crypto transactions, signaling an unambiguous shift towards a stricter regulatory approach. Who would have thought that the land of cheese and chocolate would be so invested in scrutinizing our digital coins?

What’s the Deal with Off-Chain Data?

One of the intriguing aspects of this initiative is the focus on “crypto off-chain data.” This refers to crypto-related transactions that aren’t directly recorded on a blockchain. According to ESMA, this includes a variety of trading activities, such as:

• Spot and derivatives trades at centralized exchanges
• Over-the-counter (OTC) trading

In essence, if it isn’t happening on the blockchain, it’s fair game for their investigation.

The Pursuit of Comprehensive Data

In its tender document, ESMA articulated a clear need for comprehensive data coverage. The goal is to ensure that the collected information provides a fair representation of the entire crypto market landscape. No stone—or digital coin—will be left unturned! They are specifically looking for data that includes:

• Updates on a daily basis
• Access to order books
• Details on spreads and liquidity across various exchanges and trading pairs

The stakes are high, with a contract ceiling set at a cool 100,000 euros ($102,000) for what’s expected to be a lengthy four-year endeavor. Sounds like a lucrative opportunity for data providers, doesn’t it?

Timing is Everything: A Coincidental Move?

This development follows closely on the heels of the European Council’s agreement to establish a dedicated Anti-Money Laundering (AML) authority. Set up to monitor certain crypto asset service providers, this new authority aims to crack down on