Web3 Foundation (W3F), the Switzerland-based trade group representing decentralized web software companies, has urged EU policymakers and supervisors to clarify the regulatory framework surrounding web3 technology.
During a panel discussion at the Polkadot Decoded event in Denmark, W3F’s chief legal officer, Daniel Schoenberger, highlighted that existing regulations have hindered innovation within the sector due to a lack of frameworks that accurately reflect the technology’s unique characteristics. Nonetheless, he expressed optimism about the direction of regulatory developments, particularly noting the EU’s Market in Crypto Assets (MiCA) regulation.
“Companies should be regulated according to their nature and their activities. We are encouraged by jurisdictions that have adapted their regulations to align with the realities of the technology,” Schoenberger stated. He praised the MiCA regulation for introducing a new classification for utility tokens, which recognizes the diverse functionalities of different token types.
Concerns regarding Web3 technology and decentralized finance often revolve around issues of security and privacy. Paige Collings, a senior speech and privacy activist at the Electronic Frontier Foundation, emphasized the need for regulations to focus on behaviors rather than the underlying technologies. “Decentralization doesn’t eliminate the presence of bad actors. It is vital that we apply the same standards of accountability to the decentralized web as we do to the centralized web,” said Collings. She stressed the importance of prioritizing individuals’ speech and privacy rights in any new developments in the field.