This is why Norway’s central bank is endorsing independent regulations

• Norway’s central bank asked the country’s regulators to see if the country needs to enforce its own regulations on crypto.
• Independent regulations would oversee the country’s crypto industry while the European Union’s regulatory framework comes into effect.

Norges Bank, the central banking institution in Norway, has urged the country’s regulators to come up with its own set of rules to regulate the country’s crypto industry. In a recently released report, the central bank emphasized the importance of establishing a national regulatory framework for crypto assets. 

The bank favored forming independent regulations instead of waiting for the European Union’s legislation to kick in. 

An independent regime in the works?

According to a report by Reuters, the Norwegian central bank wants authorities to develop and enforce its own set of regulations to oversee the crypto industry. This would be the case until a common European regulatory framework is in place.

Norway’s regulatory regime would keep the country’s crypto entities in check until the European Union’s recently approved norms come into effect. The comprehensive regulatory framework was given the green flag earlier this month. However, it would require firms that issue and trade crypto assets to be licensed by a national regulator starting mid-2024.

The Norges Bank’s report indicated that an independent regulatory regime would assess the risk associated with decentralized finance products among other things.

“An international regulatory framework is crucial. Nevertheless, the Norwegian authorities should assess whether to proceed more quickly rather than wait for international regulatory solutions,” the Norwegian central bank stated in its report. 

Furthermore, after some direction from the Norges Bank, Norwegian authorities will assess if the nation should proceed with independent regulations.

The central bank also highlighted potential gaps in international regulations. They also noted that they may take a while to come into full effect. However, the bank assured that it would contribute to such assessments and to regulation that promotes responsible innovation.