European tech regulators have imposed a fine of 120 million euros ($140 million) on social media platform X for violating EU regulations regarding online content.
This penalty comes after a two-year investigation under the Digital Services Act (DSA), which reportedly uncovered insufficient efforts by X to address illegal and harmful content.
Regulators also noted that the blue check marks on Elon Musk’s platform were misleading. They did not adhere to industry standards and adversely affected users’ capability to discern the authenticity of accounts.
This fine is part of a broader crackdown on major tech firms, especially social media companies. TikTok has reported that it managed to avoid a fine by making concessions.
The actions taken against X are likely to strain relations with the US. Vice President JD Vance remarked that EU regulators ought not to be “attacking” American companies.
The DSA will also extend its reach to cryptocurrency platforms, DeFi frontends, and NFT marketplaces if they achieve a sufficiently large scale. It could influence how these platforms manage advertisements, user-generated content, and the marketing of financial instruments.
EU banks establish euro-stablecoin firm as EU contemplates ESMA crypto supervision
A consortium of 10 European banks, including major institutions like BNP Paribas, plans to launch a euro-backed stablecoin by the second half of 2026.
BNP Paribas has teamed up with Danish Danske Bank, the Netherlands’ ING, Austria’s Raiffeisen Bank International, and others to establish the project under the name Qivalis. The enterprise will be headquartered in Amsterdam.
Qivalis CEO Jan-Oliver Sell remarked that stablecoins offer both convenience and financial autonomy “in the digital age.” He stated it will offer “new opportunities for European businesses and consumers to engage with on-chain payments and digital asset markets in their local currency.”
The announcement of this new initiative came just days before the European Commission proposed expanding the powers of the EU’s main financial regulator, the European Securities and Markets Authority (ESMA).
The proposal, released on Thursday, aims to transfer oversight “over significant market infrastructures like certain trading venues, Central Counterparties (CCPs), CSDs, and all Crypto-Asset Service Providers (CASPs)” to the ESMA.
This initiative is part of a larger effort to streamline regulation within European markets. Three countries—France, Italy, and Austria—have urged the ESMA to take over crypto regulations due to concerns regarding inconsistent enforcement of Markets in Crypto-Assets (MiCA) standards across member nations.
Related: What is Markets in Crypto-Assets (MiCA)?
Spot crypto assets set to trade on futures market, according to CFTC
In the US, the Commodity Futures Trading Commission (CFTC) has approved the trading of spot cryptocurrency products on futures markets.
Acting Chair Caroline Pham remarked that this move brings these products to “secure U.S. markets.” She stated that the approval followed recommendations from the White House’s Working Group on Digital Asset Markets and consultations with the Securities and Exchange Commission (SEC).
Earlier this year, the SEC and CFTC launched the “Crypto Sprint” initiative to exchange recommendations and discuss best practices.
Pham took on the role of acting chair at the start of the year and is expected to resign once the Trump administration’s nominee, Michael Selig, is confirmed by Congress.
South Africa flags crypto risks; new regulations forthcoming
The South African Reserve Bank, the nation’s central bank, issued a warning on November 25 regarding the perceived risks associated with stablecoins and cryptocurrencies, including the absence of comprehensive regulations.
The bank expressed concern that the global, borderless nature of cryptocurrencies makes them ideal for evading financial regulations.
Herco Steyn, the bank’s lead macroprudential specialist, reportedly stated that the risk arises from “the absence of a comprehensive and effective regulatory framework, which is unattainable at this time.”
In 2023, he wrote, “Regulatory oversight of stablecoin issuers—irrespective of their domicile—may lead to spillovers from the crypto asset ecosystem into the traditional financial system, especially if South African regulatory bodies fail to impose prudential requirements on stablecoin issuers.”
To address these concerns, the reserve bank is reportedly collaborating with the National Treasury to create new regulations aimed at monitoring cross-border cryptocurrency transactions and updating exchange control laws to bring them under regulatory oversight.
IMF warns that stablecoins could destabilize fragile financial systems
On Thursday, the International Monetary Fund (IMF) released a report detailing several risks associated with stablecoins, including:
Volatility in value and market runs
Disintermediation of banks
Interconnection with the financial system
Currency substitution.
The report stated that “the use of foreign currency-denominated stablecoins, particularly in cross-border scenarios, could lead to currency substitution and potentially undermine monetary sovereignty, especially when unhosted wallets are involved.”
The IMF also highlighted that many leading stablecoin issuers do not offer redemption rights for holders. “Uncertainty regarding treatment in the event of a stablecoin issuer’s insolvency could also trigger market runs,” it added.
Such runs may create first-mover advantages during a confidence crisis, resulting in investors liquidating their holdings at substantial discounts.
The IMF did acknowledge potential advantages of stablecoins, including quicker transaction times than bank transfers, particularly for cross-border dealings and remittances. They can also enhance digital payments in remote areas and decrease counterparty risk when integrated with smart contracts.
Magazine: Indian investors look beyond Bitcoin, Japan to soften crypto tax: Asia Express
