The European Securities and Markets Authority (ESMA), the European Union's financial regulatory body, is review Whether Bitcoin will be allowed into the region's €12 trillion mutual fund market remains to be seen.
JUST IN: 🇪🇺 EU Securities Authority is exploring the possibility of an addition #Bitcoin And exposure to cryptocurrencies in the €12 trillion investment market.
The European Union is preparing 🙌 pic.twitter.com/kVYZrrEFCx
– Bitcoin Magazine (@BitcoinMagazine) May 9, 2024
Emirates Authority for Standardization and Metrology Seeks feedback On expanding the assets eligible for collective investment undertakings in convertible securities (UCITS). These major retail investment products account for more than 75% of funds held by EU citizens.
If Bitcoin is approved for UCITS, it will enable it to reach the first mainstream in Europe, meaning fund managers can allocate small portfolios to Bitcoin within the mega framework.
The European Securities and Markets Authority is collecting input until August 7 before making recommendations. The move comes on the heels of Bitcoin ETF approvals in the US and Hong Kong, which signaled a rising global regulatory stance globally.
However, there are still hurdles regarding holding Bitcoin under current EU regulations. Rules such as the upcoming Markets in Cryptoassets (MiCA) legislation may require coordination on asset segregation.
However, the proactive approach taken by the European Securities and Markets Authority recognizes Bitcoin's growing importance across Europe.
Lawyer Andrea Pantaleo States The impact could outpace recent Bitcoin ETF launches. While these products focus on Bitcoin, UCITS includes diverse fund types with different asset allocations.
Therefore, approval will not necessarily lead to the creation of independent Bitcoin funds. But it will unlock trillions of UCITS for modest exposure to Bitcoin.
This would greatly benefit liquidity while encouraging EU adoption. However, there is still a long way to go before Bitcoin is listed under strict EU standards.