Home / CRYPTOCOINS / ECB Says It Plans to Use More On-Chain Data to Monitor Crypto Assets

ECB Says It Plans to Use More On-Chain Data to Monitor Crypto Assets

The European Main Bank (ECB) has issued a new report indicating that it plans to use more on-chain data to better monitor the crypto markets.

Denominated “Understanding the crypto-asset phenomenon, its risks and measurement issues,” the report reveals that the ECB has already built a system that functions “high-quality” aggregated data available online in its efforts to analyse “the crypto-asset phenomenon” to identify and monitor how the financial technology weight affect monetary policy and the risks it potentially poses to market infrastructures, payments and financial stability.

However, putting available data in this way has limits to its value. The report explains that this data leaves “gaps and challenges,” such as the publishing of financial institutions to crypto-assets and payment services that use layered protocols.

It lists, among others, derivatives and investment carriers’ exposure to digital assets, financial firms moving into custody and other services, and payments platforms abusing cryptos as potentially having implications for financial policy and stability.

While currently “contained and/or manageable,” such concatenates with regulated financial firms “may develop and increase over time.”

Going into more detail on these youngs of collecting accurate data, the EU banking authority says:

“Specifically, it is hard to retrieve public data on segments of the crypto-asset buy that remain off the radar of public authorities; some relatively illiquid trading platforms may be affected by wash dealing; and there is no consistency in the methodology and conventions used by institutionalised exchanges and commercial data providers. Moreover, new and unexpected matter needs may well arise with further advancements in crypto-assets and related innovation.”

Going forward, the ECB plans to go into more granulated detail for its analyses of crypto assets, and “will continue to work on indicators and data by dealing with the complexity and spring up challenges encountered in analysing on-chain and layered protocol transactions.”

It will further seek new data sources for dope on links between crypto assets and regulated firms.

Regarding off-chain transactions – transactions conducted off the blockchain and later aggregated bankrupt on-chain in fewer transactions – the ECB said it will work on increasing the “availability and transparency” of reported data and the methods acquainted with to provide it, “harmonising and enriching the metadata and developing best practices for indicators on crypto-assets.”

Euro sign image via Shutterstock

Check Also

XRP Price Skyrockets Past $1 as SEC Faces Legal Troubles And Favorable Regulatory Shift Looms

In December 2020, the SEC filed a lawsuit against Riffle Labs, accusing the company of …

Leave a Reply

Your email address will not be published. Required fields are marked *