International Trade Secretary Liz Truss is confident of brokering a deal that would suspend billions in tit-for-tat tariffs linked to the disagreement. Terms for the truce could be finalised as early as tomorrow, when the senior Cabinet minister meets with Katherine Tai, the US Trade Representative, in London. Britain became involved in the long-running trade spat, over subsides to their aviation giants, while still a member of the European Union.
The dispute has cost transatlantic trade some £8.6billion in tariffs since it started in 2004.
US President Joe Biden and Europe’s top officials today reached a deal to end the damaging trade war over subsidies to the rival plane makers.
Whitehall sources told Express.co.uk a “similar deal” should be reached between London and Washington tomorrow.
Under the EU’s deal, all future Airbus and Boeing passenger aircraft will be developed without subsidies during a five-year truce.
Officials hope this will give both times sufficient time for a full settlement at the World Trade Organisation (WTO).
The Government insider suggested that Brussels had “piggybacked” on another deal recently agreed between London and Washington.
In March, the Department for International Trade announced a four-month tariff suspension with the US to create room for a negotiated solution to de-escalate tensions in the Airbus-Boeing dispute.
Since 2004, the EU and US have hit each other with tit-for-tat tariffs as a result of the rift.
In the latest round of tariffs, the EU imposed duties on American imports worth £2.84billion, on products ranging from sugar molasses to orange juice.
In October 2019, the US slapped European imports with levies of £5.3billion, including French wine, Italian cheese and Spanish olive oil.
Removing the tariffs would provide a massive boost to the pandemic-stricken aerospace industry and provide more transatlantic cooperation at a time when China is posing a danger to the West.
For Britain, securing another long-term suspension would provide Ms Truss with another post-Brexit success story, shortly after the UK and Australia reached an agreement over a brand new trade deal.
Ms Truss said the pact is “the first we have negotiated from scratch, showing what we can do as a sovereign trading nation” and “strengthens the bond between two great friends and democracies”.
But it has now been revealed that the UK has legally agreed to pay £15bn over the six years to 2027, but is only able to say that £1bn of that sum has been found.
“Her estimates predict the up-front cost of the pan-European fund to the Treasury to be £15bn over the seven-year programme,” the MPs say.
“The programme will then invest the majority of this back into UK science projects. However, the report found that just £1bn of this has so far been committed.”
The report warns of “substantial uncertainty” about how the UK will meet its contribution”, given it is slashing its contributions to the EU after Brexit.
“Annual payments are likely to be £1bn early in the programme, climbing to around £3bn in later years,” it points out.
There are also fears that the UK could yet be excluded from some key areas of Horizon Europe, quantum and space, with the government now challenging the European Commission.
Many in Switzerland have failed to recognize that their exorbitant privileges vis-à-vis the European Union could not continue. The Swiss government’s recent withdrawal from talks on an EU framework agreement could reduce the country’s single-market access and prompt a fundamental rethink of its relationship with the bloc.
BRUSSELS – The Swiss government’s recent withdrawal from long-running negotiations on a framework agreement with the European Union has triggered a deep crisis in bilateral relations. For the EU, the fallout is manageable: economic relations will erode but the Union will carry on. For Switzerland, the consequences could be more dramatic. With Switzerland’s future access to the EU’s single market in jeopardy, its walkout might now require a Swiss rethink of its relationship with the bloc almost as fundamental as the United Kingdom’s after the 2016 Brexit referendum.
Switzerland is not an EU member state, but in many respects it comes close. Through some 120 bilateral agreements, Switzerland is a member of the border-free Schengen Area, is closely integrated with the EU in areas such as transport, research, and the Erasmus student-exchange program, and enjoys full access to the single market in sectors from finance to pharmaceuticals.
All told, Switzerland probably benefits more from the single market than any other European country, and pays little in return. A 2019 Bertelsmann Stiftung study found that the single market boosts Swiss annual per capita income by €2,900 ($3,515) per year – well above the EU average of €1,000 – whereas Switzerland’s corresponding financial contribution (when it is paid) in effect cost the Swiss less than €14 per capita per year.
Switzerland’s free lunch is not only economic. The main problem with the “bilateral way,” cherished by the Swiss since they voted “no” to the European Economic Area (EEA) in a 1992 referendum, is the lack of continuous updating of single-market law in Switzerland. Swiss public opinion has long held that “foreign judges” should have no role in interpreting the country’s laws. Yet, this clashes with the single market’s requirement of uniform application of supranational rules.
The Institutional Framework Agreement (IFA) that the EU and Switzerland reached in 2018, after five years of negotiations, was a belated attempt to put bilateral relations on a sustainable footing and pave the way for further Swiss access to the EU market. To secure it, the EU again made significant concessions in the face of Swiss sovereignty concerns.
Rather than requiring automatic incorporation of single-market law, the EU allowed for three years of internal Swiss procedures to adopt it (including possible referendums). And instead of insisting on sole jurisdiction for the Court of Justice of the European Union, the EU agreed to an arbitration-based dispute-settlement mechanism that would seek the CJEU’s intervention only for interpreting concepts of EU law.
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Significantly, the EU also conceded that the IFA would cover only five market-access agreements, from transport to free movement of persons. The 1972 bilateral free trade agreement remained off-limits, with the two sides issuing only a statement of political commitment to its future modernization.
But despite these concessions – which would place at risk the single market’s level playing field – the Swiss government never signed the IFA, or even defended it. On the contrary, the Swiss strategy was always to come back for more – until they walked away.
The talks had been made difficult because of disagreements over state-aid rules. Under the IFA, the EU offered a two-pillar arrangement whereby the EU rules would apply in Switzerland but would be implemented through an autonomous Swiss surveillance mechanism with powers equivalent to the European Commission’s. But when the EU negotiated its post-Brexit relationship with the UK, some in Switzerland thought that the UK received a “better” state aid deal.
This “Brexit envy” is entirely unjustified. Whereas Brexit involved the UK’s complete departure from the single market, the entire purpose of the IFA was for Switzerland to remain within it.
The even bigger thorn in the EU’s side has been Switzerland’s remonstrations against the bloc’s citizens’ freedom-of-movement rights to Swiss social security benefits, and its concerns about downward pressure on domestic wage levels. Here too, the Swiss have a weak case.
Following the Swiss 2014 referendum “against mass immigration,” the EU conceded that Swiss law could require Swiss employers to give priority to domestic job seekers. The IFA grants exceptions – provided these are non-discriminatory and proportionate – to protect Swiss wage levels. And the CJEU has recognized that freedom of movement is not absolute and that economically inactive EU citizens may be excluded from other member states’ social benefits.
The EU could not concede more. Precisely because these tricky issues are not unique to Switzerland, the EU cannot give the Swiss a free pass. Treating all countries alike matters not only for the integrity of the single market, but also for the EU’s political viability. If the EU were to give non-members privileges that even members don’t have, more might head for the exit. The EU and Switzerland must find solutions within a common framework of rules, not outside them.
Many in Switzerland fail to recognize their exorbitant privileges vis-à-vis the EU, and that this cherry-picking cannot continue after Brexit. All in all, the Swiss government has shown little interest in a fair single-market settlement with the EU, and, having broken off talks, now faces some immediate economic consequences.
For starters, future single-market access in electricity and health is off the table. And on May 26, Switzerland lost access to the EU market for new medical devices, because the EU-Swiss Mutual Recognition Agreement was not updated. Machinery and chemicals are next in line. Bit by bit, the two economies will decouple in these sectors, at an estimated cost to Switzerland of up to €1.2 billion per year.
The EU must soon make other hard choices, not least concerning Switzerland’s participation in the bloc’s Horizon Europe research program. Research cooperation is obviously mutually beneficial. But with the Swiss holding up their financial contributions and spurning efforts to find viable institutional solutions, the EU seemingly has little choice but to put its foot down.
The EU-Swiss rupture comes as the UK government also is brazenly confronting the Union by stepping away from key provisions of the Ireland-Northern Ireland protocol and asking the EU to adapt. With Norwegian support for the EEA increasingly unstable, several of the EU’s wider economic partnerships are in play.
But it is the Swiss who face the most difficult choices. A recent opinion poll showed that more than 60% of Swiss are in favor of the IFA. But similar majorities support the EEA model, or even the model of EU-UK and EU-Canada agreements.
As the Commission reminded the Swiss government after it broke off the talks, the bilateral relationship urgently needs modernizing. Instead, it is now entering the unknown.
According to recruitment firm Reed, the average salaries in the UK this year have increased by 18 percent for hospitality and catering workers, 10 percent in retail and 4 percent overall. The findings rebuked 2016 predictions by anti-Brexit campaigners that the UK would suffer a deep economic crisis from leaving the Brussels bloc.
According to Reed, the average salary in hospitality is now £26,888 compared to £22,701 last year and £23,425 in 2019.
The average salary in retail is now £29,310, it said, compared to £26,758 last year and £23,425 in 2019.
Celebrating the data, Leave EU campaigners wrote: “Still no sign of the economic Armageddon that pro-EU liars were predicting during the referendum!”
Across the Channel, Generation Frexit leader Charles-Henri Gallois also mocked deluded Remainers and Rejoiners.
He wrote: “News from Brexit UK: wages are up 4 percent!
“The prophets of Revelation are making a fool of themselves once again!”
The pound was steady in early London trading this morning, holding firm above $1.41 and showing no reaction to a delay in the UK’s lockdown easing plan, while investors took confidence from jobs data showing a record jump in employee numbers in May.
Jobs data released earlier in the session showed that the number of employees on British company payrolls surged by a record amount in May as pandemic restrictions eased – though it was still more than half a million below its pre-pandemic peak.
The figures also showed that wages grew at their fastest since 2007 in the year to April.
Marshall Gittler, head of investment research at BDSwiss, said: “The key point in my view is the much-higher-than-expected rise in wages. This is bound to be a point of discussion at next week’s Bank of England meeting.
“It’s positive for GBP as it makes normalisation of monetary policy more likely.”
The pound was also unaffected by the news that the UK is set to delay its reopening from COVID-19 lockdown restrictions by one month due to the rapid spread of the more infectious Delta variant.
Most restrictions were due to lift on June 21, but this much-anticipated step was pushed back to July 19.
But analysts remained optimistic about the pound’s prospects.
ING strategists wrote in a note: “We think that a delay in the full re-opening does not materially change the positive underlying economic recovery narrative for sterling, and data released this morning continued to endorse such narrative.”
MUFG currency analyst Lee Hardman said that he is maintaining a bullish view on the pound versus the dollar “in the belief that the economic outlook over the near-term will trump certain near-term risks that have emerged” relating to the Delta variant.
Speculators’ increased their net long position on the pound – bets that the pound will go up – in the week to June 8, CFTC data showed.
Sterling was also unaffected by news on Tuesday that the UK said it had agreed a trade deal with Australia.
The UK may have set a precedent with Australia which could create “negotiating difficulties” for future trade agreements, an expert has said.
Westminster’s first trade deal negotiated from scratch post-Brexit was announced on Tuesday.
Cabinet Office minister Michael Gove said trade deals with different countries will be “bespoke” and “appropriate to particular circumstances”.
He warned that other countries should not imagine that the Government “will be anything other than determined to get the best deal” for Britain’s producers and consumers when it comes to negotiations with them.
The European Commission President said she was “deeply convinced” a fix can be found and vowed to be more flexible. She scrambled to cool tensions ahead of talks with US President Joe Biden, who is expected to urge Brussels to compromise to protect the Good Friday Agreement. The row over a planned EU ban on the sales of chilled meats from Britain in Northern Ireland last week overshadowed the G7 summit in Cornwall and a Nato gathering in Brussels.
And it threatens to further disrupt decision-making processes in both Brussels and London.
Speaking ahead of her meeting with the US President, Mrs von der Leyen said: “I have always said I want a new beginning with old friends where the UK is concerned.
“We see that at the beginning now, there are difficulties, and there are serious issues that have to be solved.
“I’m deeply convinced with a constructive approach, and with the notion that we know, it’s a long term relationship. We are building here. These issues can be overcome.
“We know that Withdrawal Agreement and the protocol, are the best we could have gotten in a complicated situation.
“It is very good that we have the Trade and Cooperation Agreement, and now it’s our duty on both sides to make sure that it works, and to implement it. I think this is our responsibility to our people on both sides.”
Brussels had threatened Britain with a trade war over Boris Johnson’s vow to ignore its sausage blockade.
Top eurocrats said the bloc was ready to slap tariffs and quotas on British goods if the Prime Minister did not back down.
Ministers have not ruled out refusing to enforce the blockade if a long-term solution cannot be found.
Relationships between the UK and EU have hit a new low with a six-month grace period on the EU red tape set to expire soon.
US President Joe Biden is expected to receive reassures from Mrs von der Leyen and European Council chief Charles Michel that the EU is willing to be flexible to protect the Good Friday peace agreement.
The White House has confirmed Mr Biden told Mr Johnson that the Brexit row should not be allowed to undermine the delicate peace process.
Until now, Mrs von der Leyen, backed by French President Emmanuel Macron, were demanding that the letter of the EU single market rules must be applied to the letter of the law without the flexibility to resolve the row over customs checks on goods moving from Great Britain to Northern Ireland.
But others, such as Commission vice-president Maros Sefcovic, who is in charge of the negotiations, are pushing for more flexibility on EU rules.
A Brussels source told the Times “there are real tensions” about how tough to be in the negotiations.
A diplomatic source added: “It is being used to help the Conservative at home.
“That is bad enough when trust is at a premium. Now Macron is making it worse.
“There is a real problem.
“Sefcovic is caught in the middle, between the UK and some in the EU. He wants to be pragmatic and on medicines has made a big offer but the political space is closing up fast.”
On July 1st, 2021, adjustments to the VAT procedures and implementation of the H7 dataset system will enter in force across the European Union. ViaEurope is all set to assist its customers to transition smoothly to these new obligations and help avoid another logistic mayhem.
AMSTERDAM, June 15, 2021 /CNW/ — ViaEurope, a leader in e-commerce logistics in Europe announces today the launch of its technology solution designed to prevent the similar chaos that followed Brexit last January. Two weeks only before new customs procedures and declaration systems will be officially implemented across the EU, the company understands from its customers that confusion and complexity remain among e-Commerce suppliers. “Just like with Brexit, they are struggling to adjust to new requirements following the coming EU customs regulations. Many actually fear that hundreds of thousands of parcels won’t be processed on time resulting in huge delivery delays,” confirms BJ Streefland, ViaEurope’s CEO. The latter also warns, that, unlike Brexit, there won’t be any transition period following the new I-OSS procedure implementation.
In the light of all the coming changes, as a tech company, ViaEurope wasted no time adjusting its unique platform and came out with solutions to answer the market’s concerns.
H7 dataset – I-OSS Customs clearance
Every EU Member State has implemented a new declaration system following the introduction of the H7 dataset. By using the H7 dataset, shippers and sellers will be able to clear e-commerce shipments with an I-OSS number and get exemption of the VAT at import. ViaEurope is the first company in Europe to connect both the DECO (NL) and IDMS (BE) declaration systems which were set up by the two countries’ respective customs authorities.
Customs clearance without I-OSS
Under these new rules, where “bulk clearance” will no longer be possible, more challenges will arise, especially if the seller hasn’t got an I-OSS number. In this specific case, or when the shipment’s value is above 150 euros, it will become either an administrative nightmare or a technological challenge to customs clear all B2C shipments in one country without creating T1 documents. The alternative being to use declaration systems such as AGS in The Netherlands, which were not designed for e-Commerce.
For this scenario, ViaEurope has put together an innovative approach that will allow customers to easily declare and process both I-OSS and non-I-OSS shipments consolidated in one e-HUB, for example Amsterdam Schiphol Airport. Over the past five years already, ViaEurope has taken the lead regarding e-commerce customs clearance automation, resulting in a smooth experience for the customer as their shipments are cleared in either AGS or DECO in The Netherlands.
Avoid double taxation >150 euros
Taking into account that the new I-OSS regulation does not cover B2C shipments with a value >150 euros, platforms won’t be responsible for collecting and paying the VAT. The seller will still have the obligation to declare and pay VAT in the country where the transaction took place. This might be a different country from where the import declaration was made, potentially resulting in double taxation. To avoid such an unpleasant and un-efficient situation, ViaEurope leverages both its technological and legal capabilities to defer the VAT due at import to the VAT number of the seller in the country of destination.
No transition period
As a reminder to the market, ViaEurope also states that unlike with Brexit, the European Union decided against a transition period for the introduction of the I-OSS. Which means that from July 1st at 00:01, VAT must be paid for all B2C shipments, including the goods sold before July 1st yet arriving in the EU after July 1st. “Shipments sold before July 1st cannot be cleared using the H7 dataset but only using the traditional declaration systems like AGS (NL). Alternatively, parcels can be shipped with a T1, and customs cleared in each EU country individually, but we do not provide this costly and ineffective service for B2C parcels,” explains the CEO.
ViaEurope’s capacity to swiftly adapt to new regulations or implementation of new customs’ systems is not a coincidence. The company’s solid IT foundations and data analysis capacities enable its team to anticipate challenges. Chief Product Officer at ViaEurope, Bart Gerretse emphasizes that in-house developed technology added to an effective understanding of customs responsibilities add immense value to the chain of services the company offers today. “Technology is our core business. Logistics comes second. That’s why for five years now, our squad of developers has been working with intelligence and creativity to build up a smart and agile platform. A platform that can support hundreds of thousands of declarations each day. A platform that allows us to morph when needed, simply because this is how we predicted e-logistics will be. July 1st is around the corner and we are ready. I even dare to say it will be business as usual for us.“
About the company
ViaEurope is an e-logistic company based in Amsterdam. Although it has been the business of technology and logistics for five years already, the company still operates and grows with a start-up mindset. Technology is at the core of the company strategy. ViaEurope processes more than 350 tons or over 300,000 e-commerce parcels each day. The majority of its volume comes by air, sea, rail, and road and transit via its connected warehouses or e-HUBs located at Amsterdam Schiphol Airport and Liege Airport in Belgium. For more information check out our website viaeurope.com and our LinkedIn profile.
For more information (press only) Sarah Douag Head of Communications ViaEurope 0031 646 32 43 11 sarah@viaeurope.com
Related Images
viaeurope-i-oss.png ViaEurope I-OSS New I-OSS regulation starting on the 1st of July
What is it with Labour and Brexit? An issue that during Theresa May’s premiership looked like it could rip the Conservative party apart has instead made them electorally invincible – and caused huge problems for the Labour party.
For that reason, Keir Starmer tends to avoid the topic these days, seeking to show that he and his party have ‘moved on’. But some days, he can’t help himself. Yesterday was one of those days. Speaking about the Northern Ireland protocol on the radio, Starmer said:
‘We do need to remind the Prime Minister that he signed on the dotted line: this is what he negotiated. If he’s saying it doesn’t work he should look in the mirror and say, well, did I sign something then that wasn’t very sensible?…He didn’t read it, didn’t understand it or he didn’t tell us the truth about it when he said what it had in it.’
But whether or not Starmer’s criticism of Boris is fair, it begs the question that if Starmer knew what the protocol entailed – not to mention all the other troublesome aspects of Boris’s Brexit deal – why did he whip his MPs to vote for its implementation in December?
Starmer’s supporters might well say that he had little choice. After all, the alternative was no deal. Or, they might say, voting it down would have been painted by the Tories as an attempt to block Brexit. But this hardly seems credible. Surely if Starmer thought it was a bad deal, he should have been able to make that point while also being clear he did not want to overturn the referendum.
But what Starmer said next in his interview was even more troubling. It also gives some indication of the perilous situation Labour is in.
‘Having checks between Great Britain and Northern Ireland is not the way forward. Having any checks between the Republic and Northern Ireland is absolutely not the way forward. So we need to make some real progress,’ Starmer said.
Again, this begs a question which Starmer has so far offered no answer to. If we don’t have checks in the Irish Sea and none on the island of Ireland itself, what exactly is Keir Starmer proposing as his magical solution to this problem?
The options are limited to those which would spell doom for Labour: re-joining the Single Market or the Customs Union, the EU itself, or, at the very least, spending a long time – probably about a decade – negotiating some other arrangement with the EU that solves this problem.
And yet, not only has Starmer ruled out re-joining any of those things, he has ruled out renegotiating the post-Brexit settlement in any fashion.
All Starmer is doing is annoying Remainers while confirming for many Leavers what they have always suspected: the Labour leader wants to reverse. If Labour is offering no credible alternative to the problems created by this government, why should anyone even think about voting for them? Starmer’s party is good at diagnosing the problem but hopeless at putting forward any solutions.
Starmer has said many times that he wants to leave Brexit behind and ‘move on’. Unless he wants to majorly shift Labour policy on Brexit back towards a Remainer friendly position – and it is questionable whether he could even pull that off now – he should follow his own advice. Whenever he talks about anything Brexit related these days, it comes across as a confusing mess. All he does by bringing all this up in nonsensical fashion is remind Remainers he is no longer one of them, while at the same time confirming for Leavers that he’s Mr Remain.
This is another example of Starmer’s own brand of cakeism: he wants to seem like he’s put Brexit behind him but then pops up with a comment that completely goes against everything he’s said about the issue since becoming Labour leader.
If Starmer thinks the current post-Brexit arrangements leave a lot to be desired, he should come clean about what he is proposing to do otherwise. Alternatively, if he really wants to show everyone that Labour has ‘moved on’ from Brexit, he should just keep quiet.
The European Union should allow its banks to continue clearing euro derivatives in London and avoid being “protectionist” in financial markets, London Stock Exchange Chief Executive David Schwimmer said on Tuesday.
Britain’s full departure from the EU has largely severed the City of London’s ties with the bloc, and EU permission for the London Stock Exchange to keep clearing euro derivatives for EU customers expires in June next year.
The EU’s executive commission is asking banks and asset managers how quickly they can shift trillions of euros in derivatives clearing from London to Deutsche Boerse (DB1Gn.DE) in Frankfurt and if legislation is needed.
“I think it’s critically important for the EU to remain open and to resist the protectionist temptation,” Schwimmer told a European Financial Services conference.
“What has made the EU so successful is its openness to the world and being able to embed itself in global ecosystems.”
EU firms should be able to access the same liquidity, services, data and technology capabilities as their peers in respect to clearing, Schwimmer said.
“I am not arguing for an absence of control by the EU over important strategic areas,” he said, adding: “I really hope that the dialogue and cross border access that we have today can prevail going forward.”
On July 15, 2021, Blucora, Inc. (the “Company”) issued a press release
announcing that it has increased its second quarter and full-year outlook. A
copy of the press release is attached hereto as Exhibit 99.1 and is incorporated
herein by reference.
As previously announced, on June 15, 2021, the Company will host a virtual
Investor Day. A copy of the materials to be presented at the Investor Day is
attached hereto as Exhibit 99.2 and is incorporated herein by reference.
The event will be webcast via the Company’s events page on its investor
relations website. Investor Day materials and the webcast replay will also be
posted on the Company’s investor relations website at https://www.blucora.com/investors.
The information in Item 7.01 of this Current Report on Form 8-K (including
Exhibits 99.1 and 99.2 attached hereto) is being furnished pursuant to Item 7.01
and shall not be deemed to be filed for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise be subject
to the liabilities of that section, nor shall it be deemed to be incorporated by
reference in any filing under the Securities Act of 1933, as amended, or the
Exchange Act, whether made before or after the date hereof and regardless of any
general incorporation language in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
99.1 Press Release, issued June 15, 2021 (furnished pursuant to Item
7.01).
99.2 Blucora, Inc. Investor Day Presentation dated June 15, 2021
(furnished pursuant to Item 7.01).
104.1 Cover Page Interactive Data File (embedded within the Inline XBRL
Document).
Cryptocurrencies and their blockchain technology have the potential to disrupt the financial system as we know it today, as they lessen the need for the traditional banking model and lower transaction costs.
But according to the top US portfolio manager and equities head for one of the biggest asset management firms in the world, they will never get the chance to do that — at least in the form that they exist today.
Marco Pirondini of Amundi Asset Management — which oversees $2 trillion in assets — told Insider that he believes the US government will move to regulate cryptocurrencies in a big way in order to protect the dollar’s status, and that assets in the space, including bitcoin and ether, will not play a bigger role in the financial system in 10 years than they do today.
“I don’t see any state that is willing to lose control over its own currency in favor of these other currencies,” Pirondini said during a June 10 phone call. ”If [a cryptocurrency] is fundamentally existing outside of the framework of the government, I think they will really struggle to take off. And I think that the government will increase the legislation and the controls and will make them innocuous in time. Because government wants and needs control of the currency.
He added, “Can you imagine the US not in control of the monetary policy? You really believe that the US will accept to not control its monetary policy?”
The comments follow similar remarks from Amundi CIO Pascale Blanque, who said regulators would be forced to “stop the music” on bitcoin. After falling by more than 50% from its record high in April, the world’s largest cryptocurrency was up 37% this year as of Monday afternoon.
Pirondini said this regulatory storm has already begun around the world, highlighting that China has already taken steps to regulate the space and talks of regulation in the US are swirling in Washington.
“The world of these digital currencies that live outside the rule I think is coming to an end,” he said.
While he sees regulation hurting today’s most popular cryptocurrencies, Pirondini said he thinks blockchain technology could end up being adopted by the US government and that a US dollar digital currency could come to fruition.
Regulation a negative?
Though Pirondini sees regulation as a potential negative for cryptocurrencies, many in the crypto world seem to welcome the prospect of regulation with open arms because it would legitimize the assets.
“I 100% believe that regulation is a great thing for the space,” Aya Kantorovich, the head of institutional coverage at crypto trading platform FalconX, told Insider in May.
“It’s not going to deter from any growth in the space, I should hope, and what we’ve seen in the new administration in the past is that there’s been a lot more communication between the industry and the regulators back and forth, which I think is a really great sign.”
Luke Lloyd, an investment strategist at Strategic Wealth Partners, told Insider in February that while he thinks regulation around bitcoin specifically would spook investors in the near-term, it would be a positive longer-term.
“Regulation would actually mean the government is acknowledging it and if they back it in anyway would help build more trust around it,” Lloyd said.
Still, he said in a message on Monday that he thinks there’s a chance that smaller coins are outright banned. Bitcoin, however, is now too big for the government to completely shut down.
Ultimately, the type and severity of any regulation the US government places on cryptocurrencies will determine their future viability.
