As the world is preparing itself for a transitional towards the blockchain technology, policymakers in the European Union are working towards a smooth transition to the blockchain sector.
Last Wednesday, March 6, the European Union Blockchain Observatory published a report with recommendations for the scalability and interoperability of the blockchain technology. Taking into consideration different stakeholders and sources, the latest report offers insights into the current and future possible scenario of the blockchain sector in Europe.
Interoperability Within the Blockchain Ecosystem
The report is actually prepared by blockchain tech company ConsenSys on behalf of the European Union Blockchain Observatory and Forum. The authors have recommended standards for seamless interoperability between different blockchain networks as well as standards for digital currencies.
The report states that over a period of time, it will be easier for different blockchain network to work under one ecosystem. As a result, it will also steer the collective growth of the entire ecosystem. The report also supports the research and implementations of projects related to developing the blockchain infrastructure. It notes:
“Currently the EU is active in supporting blockchain research in a number of ways, from the EU Blockchain Observatory & Forum [...] to the allocation of up to EUR 340 million [$382 million] to support blockchain projects through 2020 under the Horizon 2020 programme. While these are laudable, the EU should not rest on its laurels. Both the U.S. and China have expressed strong support for blockchain research, with the former even going so far as to include it as part of its USD 700 billion defence budget.”
Cooperation Between Policymakers & Industry Players for Blockchain Growth
The report also notes that for sustainable growth of the blockchain sector, policy makers and industry players need to work in cooperation. However, the report also recommends that the EU should currently provide more scope of experimenting with new projects and learn from the outcomes.
It recommends a “wait-and-see” approach before introducing governance-related regulatory measures or bringing blockchain standards. Furthermore, it also requests policymakers to adopt an educational and research attitude for facilitating blockchain-based payments and utilizing smart contracts.
To ensure the growth of the blockchain sector, the report also suggests removing friction with the General Data Protection Regulation (GDPR) as well as establishing the legal status of cryptocurrencies and smart contracts.