The European Union Commission has put out a call to study “embedded supervision” of decentralized finance (DeFi) protocols on the Ethereum blockchain, signaling greater EU regulation is on the horizon.
The pilot aims to “develop, deploy and test” a built-in technology to supervise activities within the decentralized finance space. Researchers will gather automated supervisory data directly from the Ethereum blockchain to monitor DeFi activity in real time.
The study is likely to cost 250,000 euros and could take 15 months to complete.
Members of the European Parliament passed the Markets in Crypto Assets (MiCA) bill into law. The landmark legislation will create a comprehensive regulatory framework for digital assets in the region, which includes providing marketing guidelines for crypto companies and protections for investors.