Governance and Control of Data and Digital Economy in the European Single Market
Legal Framework for New Digital Assets, Identities and Data Spaces
- Open Access
- 2025
- Open Access
- Book
- Editor
- Carmen Pastor Sempere
- Book Series
- Law, Governance and Technology Series
- Publisher
- Springer Nature Switzerland
About this book
In an era where the digital realm is evolving at an unprecedented pace, the legal framework must adapt accordingly to ensure effective governance and control. This open access book explores the intricate web of regulations governing new digital assets, identities, and data spaces within the European Single Market. Through a comprehensive exploration of emerging concepts, it provides clarity amidst complexity and empowers stakeholders to navigate the evolving digital landscape with confidence, making it essential reading for legal professionals, policymakers, regulators, academics, and industry practitioners.
The book explains the need for legal adaptations to incorporate new technologies in the European Union, focusing on regulating Distributed-Ledger Technologies (DLT/Blockchain) and crypto-assets through the MiCA Regulation. It discusses the challenges and opportunities involved in ensuring stability and user protection and investigates the regulatory frameworks for Asset-Referenced Tokens, E-money Tokens, Utility Tokens, and Non-Fungible Tokens (NFTs). It also addresses related topics such as artificial intelligence, digital identities, data spaces, and cyber-security, providing an analysis rooted in European law that points to the European Roadmap to the Digital Decade for 2030. It deals with the European Digital Identity in the eIDAS2 Regulation and the Artificial Intelligence Act, both adopted in 2024, providing a lege ferenda perspective.
Additionally, the book examines Open Data and Open Finance, emphasizing their roles in promoting competition and innovation while addressing data privacy and security concerns. It covers the implications and challenges of Digital Money and Digital Payments, particularly in the context of the Digital Euro project, the impact on monetary policy and financial inclusion, and the European Digital Identity — the EU Digital Identity Wallet, EUDI — enabling mutual recognition of electronic identification systems across EU countries.
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Table of Contents
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Recent Technological and Legal Developments
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Frontmatter
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The Legal Framework for New Digital Assets, Identities, and Data Spaces. Introduction
- Open Access
Download PDF-versionThe chapter delves into the rapidly evolving legal landscape for new digital assets, identities, and data spaces. It discusses the transformation of traditional business transactions through technologies like smart contracts and blockchain. The text highlights the challenges and opportunities presented by decentralised platforms and the need for a robust legal framework to govern them. It also explores the implications of these technologies on financial stability, cybersecurity, and the future of digital identities. The chapter offers insights into the European regulatory approach and the potential impact of these innovations on the global economy.AI Generated
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AbstractThe Internet has significantly transformed society, fostering technological literacy and reshaping business transactions through advancements like blockchain and distributed ledger technologies (DLT). Traditional business concepts are evolving as users increasingly engage with digital identities and smart contracts. This introductory chapter outlines the legal frameworks for emerging digital assets, identities, and the Internet of Value, with a focus on the European context, particularly Spain. Despite the rise of Big Tech, which centralises data, there are persistent trends towards decentralisation, exemplified by peer-to-peer networks and blockchain. These developments raise concerns about the monopolisation of digital infrastructure and the potential need for a “new social contract” regarding digital identity and ownership. Regulatory frameworks must adapt to address the unique legal and security challenges posed by cryptocurrencies and digital assets. As Europe navigates this transformation, initiatives like the Markets in Crypto-assets Regulation (MiCA) and the Digital Euro Package aim to create coherent legal structures. This work emphasises the importance of securing trust in the digital economy while considering the implications of emerging technologies and the evolving landscape of digital finance. -
A Regulatory Framework for Legal Ecosystems in the Context of Emerging Web-Based Systems and the European AI Value Chain Regulations
- Open Access
Download PDF-versionThe chapter discusses the regulatory framework for legal ecosystems in the context of emerging web-based systems and European AI value chain regulations. It introduces the concept of a smart legal ecosystem (SLE) and explores how AI and other technologies can be integrated into legal systems. The author also examines the challenges and opportunities presented by these technologies, including the need for ethical and legal principles to be embedded in regulatory models. Additionally, the chapter provides a historical perspective on the evolution of legal professions and the emergence of web-based legal services. It concludes with a discussion of open questions and potential future developments in the field.AI Generated
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AbstractThe European Commission is making significant efforts to regulate and harmonise the digital single market, covering areas such as data processing, data flows, interoperability, exchanges, and the roles, responsibilities, and potential liabilities of owners, designers, and service providers. This Chapter takes an internal perspective of legal governance, exploring the regulatory models and instruments crucial to constructing legal ecosystems. Initially, there were nine European common data spaces to be regulated in real-time, with an additional tenth space related to the European Open Science Cloud (EOSC). Four more spaces (including human heritage and tourism) have been recently added. This Chapter delves into the proposed instruments for regulation. The central argument is that the regulation and development of platforms within the platform-driven economy, particularly in the banking and financial sectors, go beyond traditional frameworks of hetero, co-, and self-regulation. Instead, these processes involve intra-technological and computational regulation. Therefore, regulatory approaches must incorporate a formal inside-outside and a middle-out/inside-out approach derived from intelligent information systems. A comprehensive framework will be outlined to encompass hard and soft law, policies, and ethics within the context of emerging scenarios fostered by Web 3.0, Industries 4.0 and 5.0. This Chapter will delve into the common and specific regulatory instruments and mechanisms proposed for these data spaces, thoroughly examining the technical and legal frameworks required to incept and flesh out these digital ecosystems. -
Towards Proprietary Digital Assets Under European Soft Law
- Open Access
Download PDF-versionThis chapter delves into the legal nature and evolution of proprietary digital assets under European soft law, focusing on the concept of smart property as defined by Szabo. It discusses the legal treatment of digital assets, including ownership, possession, and security, and examines the various types of crypto assets such as cryptocurrencies, stablecoins, and non-fungible tokens (NFTs). The chapter also explores the legal challenges and regulations surrounding digital assets, such as the UNIDROIT Principles, ELI Principles, and UK Law Commission reports. Additionally, it addresses the legal implications of digital asset deprogramming, enforcement, and applicable law. The text offers a detailed analysis of the legal landscape of digital assets, making it a valuable resource for legal scholars, practitioners, and policymakers.AI Generated
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AbstractThis research provides for the legal treatment of digital assets regarding proprietary rights, possession, transfer of ownership, succession, extinction, enforcement, and applicable law, as provided for in the ELI Principles on the Use of Digital Assets as Security, the UK Law Commission Digital Assets: Final report, and the UNIDROIT Principles on Digital Assets and Private Law. -
Crypto Assets and Financial Data Space Regulation in the EU’s Hybrid System of Hard and Soft Law
- Open Access
Download PDF-versionThe chapter delves into the EU's ambitious plan to create a robust financial data market through the proposed FiDA regulation. It explores the regulatory landscape, focusing on the challenges posed by AI and data protection. The text highlights the need for standardisation and the importance of data governance frameworks to ensure data sovereignty and consumer protection. It also discusses the potential benefits of data sharing, such as increased financial innovation and improved access to credit, while addressing concerns about data privacy and algorithmic bias. The chapter provides a detailed analysis of the FiDA proposal, its impact on the financial sector, and the steps needed to implement a successful financial data market in Europe.AI Generated
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AbstractThe new data economy needs diverse financial data from many data holders, far removed from the data a traditional bank would hold. This paper outlines the new vision for the common European Financial Data Space, where multiple interconnected data ecosystems, like the internet, are designed to empower individuals by placing them at the centre. This seeks to keep the financial sector of the European Union in tune with the digital transformation while ensuring, at the same time, the security and confidence of consumers. For these reasons, the EU seeks open finance and a legal framework that underpins a new regulatory approach based on coregulation, comprising a hybrid system of hard law and soft law for the exchange of financial data. This regulatory proposal is FiDA [proposal for a Financial Data Access regulation]. The paper also examines the proposed legal regime and its coordination with the current regulation of new crypto assets and their financial data. It examines the basis for and explores the limitations of the latest legal framework for regulating access to financial data. The current regulation that will be referred to is the existing regulation on crypto-assets (Markets in Crypto-assets- MiCA, access to payment data (such as Open banking, Payment Services Directive, PSD2), and the eIDAS 2, as well as the proposal for the modernisation of the existing EU Payment Services Directive (Open Finance, PSD3 and FiDA). -
Web Technologies for Decentralised Identity
- Open Access
Download PDF-versionThe chapter delves into the concept of decentralised identity, emphasising the World Wide Web Consortium's (W3C) efforts to standardise Decentralised Identifiers (DIDs) and Verifiable Credentials (VCs). It discusses the historical context of identity management on the web and the need for decentralised solutions. The W3C's specifications for DIDs and VCs are explained, highlighting their potential to enhance privacy, security, and user control over personal data. The chapter also explores the integration of these technologies with the Open Digital Rights Language (ODRL) for policy representation and their applications in various industries, particularly Fintech. Despite the challenges and critiques, the chapter underscores the significant advancements and potential of these technologies in reshaping digital identity management.AI Generated
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AbstractThis chapter analyses technologies that support decentralised identity on the Web. The World Wide Web Consortium, which maintains the technical specifications of the Web, has consistently advocated for decentralised models for sharing information. Some of their latest recommendations include the specification of a Decentralised Identifier (DID) and a Verifiable Credential (VC) following the Semantic Web principles. The claims contained in these credentials can be algorithmically verified without the intervention of authorities. These technologies are often associated with implementing the Self-Sovereign Identity paradigm, and this chapter evaluates whether this will happen in practice, particularly in the context of the financial sector. Whereas some privacy concerns are identified, the integrated use of DID, VC and Open Digital Rights Language ODRL will present clear benefits in at least some commercial settings. -
The National Security Framework as a Cybersecurity Reference for Information Cryptosystems
- Open Access
Download PDF-versionThe chapter delves into the significance of cybersecurity in the 21st century, highlighting the National Security Framework (ENS) as a crucial reference for information cryptosystems. It traces the evolution of cybersecurity regulations in Spain, from the initial ENS in 2010 to the updated version in 2022, emphasizing the importance of risk management and resilience. The text also explores the application of ENS to crypto assets, discussing key considerations such as private key protection, exchange platform security, and regulatory compliance. Additionally, it underscores the role of the ENS in ensuring the security of public sector entities and their private sector suppliers, emphasizing the need for continuous improvement and adaptation to the dynamic cyber threat landscape.AI Generated
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AbstractIn today's hyper-connected world, implementing security in cyberspace has become a global strategic priority. As technology’s role in society increases, cybersecurity becomes an increasingly bigger challenge. In addition, the cyber threat landscape is evolving, with the emergence of new risks and the sophistication of existing threats. Cybercriminals are increasingly targeting specific sectors, such as energy, finance, government, and healthcare, to cause maximum disruption and financial gain or loss. In Spain, the successive editions of the National Report on the State of Security (INES) and the body of CCN-STIC security guides have resulted in greater accumulated experience in its application and better knowledge of the situation. The new National Security Framework 2022 stands as a pivotal platform, addressing cybersecurity in a manner intricately linked to digital transformation. This is achieved through a robust and consolidated regulatory framework, making it the most significant development in this field. In this sense, Royal Decree 311/2022 is a guiding light for security in the digital society. Its applicability to crypto-asset systems is crucial to building a reliable foundation in the new financial paradigm. It represents a reference framework, a robust framework for assessing and improving security in systems that handle crypto assets.
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New Assets: Assets Regulated in MiCA
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Frontmatter
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Regulating Stablecoins in the European Union. Asset-Referenced Tokens and E-Money Tokens
- Open Access
Download PDF-versionThe chapter 'Regulating Stablecoins in the European Union: Asset-Referenced Tokens and E-Money Tokens' delves into the regulatory landscape of stablecoins under the Markets in Crypto-assets (MiCA) regulation. It begins by defining stablecoins and their classification into asset-referenced tokens (ARTs) and e-money tokens (EMTs). The text explores the intricacies of EMTs, which are crypto assets pegged to official currencies, and the comprehensive rules governing their issuance, redemption, and safeguarding of reserves. It also discusses the requirements for ARTs, which maintain stable value by referencing other assets or rights, and the additional regulatory measures for significant ARTs. The chapter emphasizes the need for robust governance, risk management, and transparency to ensure the stability and integrity of these financial instruments in the European market.AI Generated
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AbstractStablecoins are regulated in the European Union under Regulation (EU) 2023/1114 on Markets in Crypto-assets. That Regulation establishes a bespoke legislative regime for ‘asset-referenced tokens’ and ‘electronic money tokens’. Both are crypto assets, i.e., digital representations of a value or a right that can be transferred and stored electronically using distributed ledger technology or similar technology. Both aim to maintain a stable value by referencing another value or right, a specified asset, pool, or basket of assets. Finally, existing EU financial services legislation covers none of them.This work describes the main features of those crypto assets. Current rules seek to provide legal certainty for issuers of stablecoins in the UE (by imposing a common set of provisions applicable to all of them regarding their authorisation, governance requirements, etc.), give appropriate protection for holders of those crypto assets (by regulating their rights against issuers, the rules applicable to crypto-asset white papers or the marketing communications), or address potential financial stability and monetary policy risks that could arise from their use as a means of exchange (by monitoring or restricting the issuance). -
Stablecoins in the MiCA Regulation
- Open Access
Download PDF-versionThe chapter begins by introducing the concept of stablecoins, which are designed to maintain a stable value by referencing legal tender or other assets. It then delves into the MiCA Regulation, which classifies crypto assets into three types based on their stability. The focus is on asset-referenced tokens and electronic money tokens, with detailed explanations of their definitions, characteristics, and regulatory requirements. The text highlights the unique challenges and potential risks associated with stablecoins, particularly those classified as 'significant stablecoins' or 'global stablecoins'. It also discusses the regulatory approach of the MiCA Regulation, including the specific obligations and safeguards for issuers of these stablecoins. The chapter concludes by emphasizing the importance of stablecoins in the financial market and the need for stricter regulation to mitigate potential risks.AI Generated
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AbstractThis work offers a legal analysis of stablecoins, a novel form of cryptocurrency that has emerged as a distinctive alternative to previous cryptocurrencies, which are characterised by their oscillating and highly volatile value, making them unsuitable for use as a payment instrument or functional legal tender equivalent. The pivotal legal framework for stablecoins is the Markets in Crypto-Assets Regulation (MiCA), which addresses the conceptual aspects of stablecoins. Despite its presence in MiCA, stablecoins lack a specific legal definition therein. The Regulation’s classification is based on whether crypto assets aim to stabilise their value relative to other assets. This chapter, therefore, focuses on the in-depth examination of the two subcategories of the Regulation that fall under the umbrella of stable crypto assets: asset-referenced tokens and electronic money tokens. We delve into their unique characteristics, including their vocation for stability and, in turn, the intriguing differences between the two subcategories. -
Electronic Money Tokens Under the MiCA Regulation
- Open Access
Download PDF-versionThe chapter begins by outlining the historical context of electronic money regulation in the EU, highlighting the evolution from Directive 2000/46/EC to the current MiCA framework. It then delves into the legal concept of electronic money, emphasizing its definition and differentiation from other financial instruments. The focus shifts to the specific regime of electronic money tokens under MiCA, detailing the requirements for issuance, redemption, and additional obligations for significant tokens. The chapter also discusses the technological aspects of electronic money tokens, their classification, and the regulatory implications of the MiCA framework. Throughout, it provides a nuanced understanding of the interplay between traditional financial regulations and the emerging field of cryptocurrencies, making it a must-read for professionals in the financial and legal sectors.AI Generated
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AbstractThis paper examines the legal regime applicable to electronic money represented by digital tokens, drawing from the general regime for electronic money established by Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions, and the specific regime established by Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2011 on markets in crypto-assets, and amending Regulations (EU) No. 1093/2010 and (EU) No. 1095/2010 and Directives 2013/36/EU and (EU) 2019/1937 (MiCA Act). Particular attention is paid to the differentiating or specific elements derived from the crypto-asset status of tokens representing electronic money. It is concluded that this type of electronic money, designed as a payment instrument, can also be negotiated and used as an investment instrument. It, therefore, has an ambivalent or hybrid nature as a crypto-asset and an exchange instrument. -
Utility Tokens and Their Regulation Under MiCA
- Open Access
Download PDF-versionThe chapter discusses the regulatory landscape of utility tokens under the MiCA (Markets in Crypto-assets) regulation, highlighting their legal definition and the economic role they play. It delves into the historical context of blockchain technology and crypto assets, the regulatory challenges they pose, and the specific provisions of the MiCA regulation aimed at addressing these challenges. The text also explores the legal nature of utility tokens, the requirements for issuing and offering them, and the protections afforded to subscribers. Additionally, it discusses the content and disclosure requirements for crypto-asset white papers, emphasizing the need for transparency and investor protection in the crypto-asset market.AI Generated
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AbstractThe MiCA Regulation regulates crypto assets which are not financial instruments, providing them with a legal regimen through a specific regulation. The MiCA regulation covers the majority of crypto asset classes currently being traded. Developing a single digital market requires a solid legal base that offers its participants security in developing distribution ledger technology projects for issuing and trading crypto assets. Utility tokens may be issued without obtaining preliminary authorisation if the projects comply with the requirements regarding the preparation, notification and publication of the crypto-asset white paper. -
Crypto-Asset Service Providers: Harmonised Framework Vs. Risk of an Unlevel Playing Field
- Open Access
Download PDF-versionThe chapter delves into the European regulation on markets in crypto assets (MiCA), examining its objectives and the challenges of implementing a harmonised framework for crypto-asset service providers. It discusses the transition process and the risks of regulatory arbitrage, market fragmentation, and an unlevel playing field. The text also explores the role of ESMA in mitigating these risks and the potential impact on market competition and consumer protection. The detailed analysis of transitional measures and their implications makes this chapter a must-read for professionals in the field.AI Generated
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AbstractThis paper highlights issues surrounding the Markets in Crypto-Assets Regulation (MiCA) that could hinder the effective and convergent application of the new harmonised framework at the European level.The transition process to MiCA is a complex journey, largely due to the implementation of transitional measures. A significant aspect of this complexity is the inclusion of a grandfathering clause. This clause, which permits national law providers to continue offering crypto-asset services under their existing national regulations for 18 months post-MiCA implementation, adds a layer of intricacy to the transition process and its implications for the crypto-asset services sector. The diverse options available under the transitional measures introduce a significant risk. On the one hand, they could lead to a forced coexistence between national and European regulatory regimes. On the other hand, they could create an unlevel playing field among service providers. This potential risk could result in some providers operating under different regulatory disciplines gaining an unfair advantage and consolidating their market position at the expense of others. In this complex and uncertain scenario, the importance of the European Securities and Markets Authority’s (ESMA) intervention in establishing best practices or guidelines becomes a crucial step towards encouraging greater convergence of national authorities in the transition process, thereby ensuring a more harmonised and effective application of MiCA. -
Crypto-Asset White Papers and Marketing Communications Post the MiCA Regulation
- Open Access
Download PDF-versionThe chapter explores the post-MiCA regulatory environment for crypto-asset white papers and marketing communications, focusing on the need for transparency and consumer protection. It delves into the common and specific content requirements for white papers, the liability regime for issuers, and the role of social media in crypto-asset promotions. The analysis also highlights the growing influence of influencers in crypto-asset marketing and the potential need for further regulation in this area. The chapter offers a detailed look at the regulatory framework and its implications for the crypto-asset market, making it a valuable resource for professionals seeking to understand the evolving regulatory landscape.AI Generated
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AbstractThis paper comprehensively analyses the regulatory framework applicable to disclosure and transparency tools used in promoting crypto assets, particularly in the context of the MiCA Regulation. The paper focuses on the information a crypto-asset white paper should contain and all relevant details about marketing communications, such as advertising messages and marketing material. In commercial communications, the work delves into Directive (EU) 2019/1024 and Regulation (EU) No. 596/2014 to examine the rules and guidelines related to the content of crypto-asset advertising posted by professional social media profiles. This will highlight how the authorities are working to prevent the publication of false, misleading, or incomplete information on these issues. -
Regulating Market Abuse in Crypto Assets
- Open Access
Download PDF-versionThe chapter delves into the MiCA regulation, which aims to regulate market abuse in crypto assets by applying principles from the Market Abuse Regulation (MAR). It discusses the minimal intervention approach, the challenges of analogical application of financial regulations, and the role of national authorities in enforcing these rules. The text also explores the specific provisions for insider dealing, public disclosure of inside information, and market manipulation, emphasizing the need for transparency and investor protection. Additionally, it highlights the complexities of cross-border market abuse and the future of crypto asset regulation in Europe, offering a comprehensive overview of the regulatory landscape and the potential impact on the crypto market.AI Generated
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AbstractArticles 86 to 92 of MiCA promote a simplified regime to control unlawful disclosure, insider dealing and possible manipulation or market abuses in issuing and trading crypto assets. The tendency to assimilate the regulation with the regulatory background of the ordinary financial market is hardly avoidable. However, the most coherent option is probably to use these references as an ex-post mechanism and not as ex-ante requirements when the ESMA guidelines don’t declare analogous application of Market Abuse Regulations.
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New Assets: Subjects and Assets not Regulated in MiCA
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Frontmatter
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Current and Future Central Bank Digital Currency (CBDC) Projects
- Open Access
Download PDF-versionThe chapter delves into the evolution of Central Bank Digital Currencies (CBDCs), tracing their origins from the digital age to the emergence of Bitcoin and stablecoins. It examines the motivations behind CBDCs, such as preserving monetary sovereignty and adapting to digital economies. The text discusses the technological infrastructure, particularly Distributed Ledger Technology (DLT) and blockchain, and their implications for CBDCs. It also analyzes the various types of CBDCs, their advantages, and disadvantages, with a focus on privacy and financial stability. The chapter includes case studies of major CBDC projects like the digital yuan, digital euro, and digital ruble, and explores the regulatory challenges and geopolitical implications of these digital currencies. Additionally, it highlights the role of international organizations like the Bank for International Settlements (BIS) in shaping the future of CBDCs. The chapter concludes by emphasizing the need for a balanced approach that ensures both financial innovation and privacy protection.AI Generated
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AbstractCentral Bank Digital Currencies (CBDCs) are monetary projects of digital public money at different stages of development, whose issuance corresponds to central banks. It is a digital representation of money with fiat currency’s legal nature. Still, like cash, and unlike electronic bank money, it has the guarantee of a central bank and not a deposit guarantee fund. This means that the monetary authority is responsible for the conditions of its issuance, distribution and value, as well as the network or infrastructure that supports its operation and possible programmability, whether retail (rCBDC) or wholesale (wCBDC). Among the most important examples of CBDC projects are the Chinese digital yuan and the digital euro, the latter still undergoing the study (or preparation) phase by the European Central Bank. The objective of this paper is to carry out a conceptual and comparative study on the development of these and other CBDC projects, providing a regulatory analysis of the consequences that the implementation of this new monetary and technological reality will bring to the banking system, as well as the impact that these digital currencies have on the banking market, the protection of users and their relationship with the rest of the Fintech environment. It will also discuss some of the initiatives taking place at the international level, such as the projects within the BIS Innovation Hub to address different issues that will define the final configuration of CBDCs in the near future. -
The Digital Euro Package: From Legal Tender to Payment Services Providers
- Open Access
Download PDF-versionThe Digital Euro Package outlines the proposed regulatory framework for the digital euro, including its legal tender status and the role of payment services providers (PSPs) in its distribution. The chapter delves into the eight key sections of the proposal, highlighting the digital euro’s legal framework, technical specifications, privacy measures, and anti-money laundering provisions. It also compares the digital euro with the legal tender status of physical euro currency and discusses the potential impact on the European financial system. The chapter emphasizes the importance of PSPs in the digital euro’s adoption, exploring the proposed changes in the Third Payment Services Directive (PSD3) and the Payment Services Regulation (PSR). It also addresses the debate on the fraud detection and prevention mechanism, showcasing the divergent views of the ECB, EBA CLEARING, and data protection authorities. The chapter concludes by stressing the need for a balanced approach in implementing the digital euro, considering its broader implications for EU integration and financial stability.AI Generated
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AbstractThis paper delves into the proposals for regulating the digital euro, establishing a connection between its legal standing and physical euro cash, and requiring payment services providers to offer digital euro services regardless of their location. It raises questions about the fundamental implications of treating the digital euro as legal tender. However, labelling the digital euro as a legal tender raises uncertainties about its core nature and purpose. The analysis challenges the notion that the digital euro is merely a digital version of physical cash, emphasising the evolving roles of central bank digital currencies and their legal and policy ramifications. With the digitalisation of the economy in mind, it examines how the involvement of payment services providers in distributing the digital euro could impact individual and economic rights. It underscores the importance of balancing security measures, privacy, and data protection while fostering competition. The paper aims to provide policymakers with insights into the design and regulation of the digital euro, underlining the necessity of clarifying its legal standing and reconsidering its classification as legal tender. It stresses the importance of thoroughly examining the conceptual foundations of the digital euro to ensure its successful implementation and regulation. -
PSD3 and the Regulation on Payment Services in the Context of Crypto Assets as a Means of Payment
- Open Access
Download PDF-versionThe chapter delves into the regulatory landscape of crypto assets with payment functions, particularly focusing on the intersection of the Payment Services Directive 2 (PSD2) and the Markets in Crypto-Assets (MiCA) Regulation. It examines the emergence of new payment instruments like payment tokens and stablecoins, highlighting the need for regulatory adaptation to accommodate these innovations. The text also discusses the hybrid nature of electronic money tokens (EMTs) and the challenges they pose in terms of regulatory compliance. Additionally, it explores the potential conflicts between payment services and crypto-asset services, emphasizing the need for a coherent legal regime to protect users and ensure the smooth functioning of the payment ecosystem.AI Generated
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AbstractThe Markets in Crypto-Assets (MiCA) Regulation establishes legal rules for crypto-assets that have a financial use and fall outside the scope of Union legislative acts on financial services. Among these crypto assets, it pays special attention to stablecoins, the so-called MiCA electronic money tokens and asset-referenced tokens, which are characterised by serving as a payment function. It is precisely this function of being a means of payment that raises the question of whether the transactions carried out with these crypto assets, or at least some of them, can be qualified as payment services, to which the legal framework for payment services, contained mainly (but not exclusively) in the Second Payment Services Directive (PSD2), currently under revision, would apply. This paper deals with the relationship between the two sets of rules (MiCA and PSD2). It analyses to what extent the existing and planned rules (PSD3 and Payment Services Regulation) can be applied to or somehow cover electronic money tokens and asset-referenced tokens. -
The Non-Financial Crypto-Asset Market: Copyright in Art Non-Fungible Tokens
- Open Access
Download PDF-versionThe chapter delves into the definition and regulation of Non-Fungible Tokens (NFTs) in the context of art. It explores the unique characteristics of NFTs, such as their ability to create scarcity in the digital space and facilitate new business models for the direct sale of digital art. The text discusses the regulatory landscape, including the European Union's Markets in Crypto-assets (MiCA) regulation, which excludes unique and non-fungible crypto-assets from its scope. It also examines the legal nature of NFTs, property rights, and the challenges posed by smart contracts and the 'lex cryptographica'. The chapter highlights the potential for new business models in the digital art market, such as the minting and sale of Art-NFTs, and the legal considerations surrounding these activities. It concludes by discussing the implications of these developments for the art market and the need for further legal clarity and regulation.AI Generated
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AbstractThe market for the sale of art-NFTs is a reality, but due to their diffuse legal nature, there are many doubts about this business model from a legal perspective. This raises uncertainties as to whether it is possible to recognise a property right over the NFT as a digital asset and an online distribution rights model, where the principle of exhaustion is recognised from the intellectual property law perspective. -
Domestic Tax Regulation in the Face of the Crypto Economy: Challenges Going Forward
- Open Access
Download PDF-versionThe chapter delves into the intricacies of taxing crypto assets in Spain, emphasizing the constitutional principle of economic capacity and the need for clear regulatory frameworks. It discusses the challenges posed by the decentralized nature of crypto assets, the valuation issues, and the lack of coordinated global legislation. The author also explores the implications of MiCA and the need for further regulatory efforts to ensure fair and effective taxation of the crypto economy. The chapter offers a detailed analysis of various crypto assets, their tax implications, and the necessary steps to achieve a fair and efficient tax system in the digital age.AI Generated
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AbstractOur tax system clings to a traditional economy linked to pre-digital criteria such as territoriality. It tries to update itself by introducing elements that attempt to deal with the new issues without resolving them head-on. The lack of tax regulation produces a sudden injustice barely resolved by soft law derived from binding administrative resolutions, such as the responses offered by the General Directorate of Taxes.MiCA demonstrates the tax system’s obsolescence in a broad and community sense. The lack of provisions for classifying new economic goods for tax purposes fragments their treatment, leads to tax conflicts, and creates legal uncertainty.This legal uncertainty contrasts with the enormous deployment of mechanisms to control compliance with tax obligations. These include the effective automatic exchange of tax information, joint inspection procedures, and the, at times, unscrupulous application of artificial intelligence to all types of available data, personal and non-personal, without time limitation.We understand that the rules applicable to the taxation of crypto assets must constantly be updated, and this is our purpose in an economy undergoing absolute digitalisation.
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New Digital Spaces and Identities
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Frontmatter
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The European Digital Identity Wallet as Defined in the EIDAS 2 Regulation
- Open Access
Download PDF-versionThe European Digital Identity Wallet, as defined in the eIDAS 2 Regulation, introduces a new model for digital identity management that aims to enhance privacy and security. This chapter explores the regulatory framework, the influence of Self-Sovereign Identity (SSI) concepts, and the progress made towards implementing the European Digital Identity Wallet. It also discusses the challenges faced by the previous eIDAS Regulation and the innovative solutions being developed to address them. The chapter highlights the role of blockchain technology, such as the European Blockchain Services Infrastructure (EBSI), in facilitating cross-border interoperability and the establishment of a robust digital identity framework. Additionally, it delves into the pilot projects and the standards involved in the implementation of the EUDI Wallet, emphasizing the importance of cybersecurity and privacy by design. The chapter concludes by discussing the legislative process and the anticipated impact of the eIDAS 2 Regulation on digital identity management across Europe.AI Generated
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AbstractSeveral legislative developments are taking place in Europe that make some regulations converge with others, and one of the most influential is the one that will govern the new digital identity model that arises from the modification of the European Regulation that defines digital identity and electronic trust services. Regulation 910/2014 is called eIDAS and has been essential in developing European-qualified trust services. Regulation (EU) 2024/1183, called eIDAS 2 because it modifies the eIDAS regulation and increases its scope, has been recently published in the Official Journal of the European Union. -
Digital Identity in a European User-Centric Ecosystem and Its Similarities with the Digital Euro Proposal
- Open Access
Download PDF-versionThis chapter delves into the origins and evolution of digital identity, tracing its roots from philosophical concepts of identity to the development of digital identity systems. It explores the historical and sociological views of identity and how they have shaped digital identity development. The text also examines the regulatory frameworks governing digital identity, including the eIDAS Regulation and the upcoming eIDAS 2 Regulation. Additionally, it discusses the similarities between the European Digital Identity Wallet and the Digital Euro proposal, highlighting the importance of user-centric design, privacy, and interoperability in digital identity systems. The chapter concludes by emphasizing the need for resilience, transparency, and adaptability in digital identity solutions to ensure their successful adoption and integration into the digital ecosystem.AI Generated
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AbstractDigital identity systems have evolved from institutional databases from the sixties through the advent of the Internet and public key infrastructure, social networks, national ID, blockchain implementations and the EUDI Wallet. To ensure the success of implementing and adopting any digital identity system, the critical factor is the digital ecosystem the user can interact with, fostering not only the interactions of the netizens with public services but also between netizens and private entities or even between netizens online. Without habitual use and ease of adoption, resistance to change and increased friction could lead to abandoning the digital identity solution. As the European Digital Identity Wallet is defined in the Regulation and standards are published to complement the requirements laid out, other proposals, like the Digital Euro initiative, share similar broad requirements on usage and acceptance. The results and experience with the EUDI Wallet will be a learning opportunity to ensure the preferred outcome when implementing similar initiatives. -
‘Human Digital Twins’ and Blockchain: Some Challenges and Solutions for Digital Identity and Privacy
- Open Access
Download PDF-versionThis chapter delves into the convergence of Human Digital Twins (HDTs) and blockchain technology, focusing on their potential to revolutionise digital identity and privacy management. It begins by introducing the evolution of Digital Twins from their origins in NASA's Apollo program to their current application in various sectors. The chapter then explores the structure of HDTs, from data collection to intelligent interfaces, and identifies the key challenges in digital identity and privacy, such as strong authentication and data protection. It also highlights the opportunities blockchain technology offers, including robust authentication, identity interoperability, and dynamic consent management. The chapter concludes by summarising the challenges and solutions, emphasising the need for a holistic approach that combines technical, legal, and ethical considerations to ensure secure and private HDT implementations.AI Generated
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AbstractThis chapter examines the integration of two significant technological developments: the ‘Human Digital Twins’ (HDT) and blockchain technology, focusing on their applications and implications for digital identity and privacy management. HDTs represent an advanced form of digital replicas that encapsulate an individual’s physical, behavioural and psychological characteristics when using multimodal and multisource data. Their implementation promises to revolutionise interaction with the digital world, offering benefits in sectors as varied as personalised medicine and digital identity management.On the other hand, the blockchain provides a decentralised and secure platform for data management, offering robust solutions to the persistent challenges of privacy and security in a digitally connected world. The convergence of HDT with blockchain technology has the potential to enhance the security and privacy of personal data and radically transform existing methodologies in identity verification, system interoperability and personal data management within regulatory frameworks.This analysis is further explored by exploring HDT’s architecture, the challenges inherent in its implementation, and the unique opportunities it offers for advanced identity and privacy management. In addition, case studies are discussed, and future trends and emerging challenges in this dynamic field are outlined. -
The Implementation of U-space: Open Challenges from the Legal-Private Perspective
- Open Access
Download PDF-versionThe chapter 'The Implementation of U-space: Open Challenges from the Legal-Private Perspective' delves into the European Union's ambitious project to manage unmanned aircraft systems (UAS) traffic through U-space. It discusses the regulatory framework established by the European Aviation Safety Agency (EASA) and the European Commission, highlighting the need for interoperability, data protection, and cybersecurity. The text also explores the integration of artificial intelligence (AI) to enhance safety and efficiency, as well as the challenges and requirements for implementing U-space services. Additionally, it addresses the economic and social implications of this project and the need for further research and testing to keep up with technological advancements.AI Generated
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AbstractThis paper addresses the main aspects of implementing U-Space in Europe according to its regulatory framework. We analyse the reasons for the delay in its roadmap and the challenges to resolve. In turn, we discuss the importance of addressing data interconnectivity and information exchange and aspects related to cybersecurity and resilience in the field of U-Space, which are not analysed by the doctrine. We also discuss the applicability of the AI Act to U-Space as a critical digital infrastructure and whether some of its services could somehow fit within the “high-risk AI systems” intended to be used as security components in their management and operation, with the important consequences that such qualification entails.
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- Title
- Governance and Control of Data and Digital Economy in the European Single Market
- Editor
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Carmen Pastor Sempere
- Copyright Year
- 2025
- Publisher
- Springer Nature Switzerland
- Electronic ISBN
- 978-3-031-74889-9
- Print ISBN
- 978-3-031-74888-2
- DOI
- https://doi.org/10.1007/978-3-031-74889-9
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