As head of Yellaw’s blockchain department, Céline works closely with the blockchain and crypto regulatory environment in Malta. She states the directives put in place by Malta earlier this year are a step in the right direction. For non-lawyer types in can defy common sense, but the introduction of palpable laws surrounding ICOs and STOs do not limit but create greater levels of freedom for companies and their projects.
“At this time for me it's good, as a lawyer we have regulation, we have rules, it is what we need. For example in France we have no regulation for ICOs or STOs, so it’s more complicated, if you want to do an ICO in France you have to use the normal system, and as you’re using crypto and blockchain technology it’s in no way the same, you need to have certification in KYC or AML. For me, the Maltese system is good because they have found a solution and they have decided to bring in regulation and new rules when you want to complete an ICO or STO.”
“For me, it’s not a problem, with the GDPR you need to have the possibility to delete personal data, this can be a technical aspect of a public blockchain.”
Céline states a major impediment to blockchain adoption in Europe is not having a single set of unifying regulations, while we touched upon Zug, Estonian and Maltese regulatory conditions, these mandates need to stretch further than national borders. Céline regards the declaration calling for help in the promotion of DLT by several Southern EU members (the ‘Mediterranean Seven’ as they’re dubbed), as a “first step”.
The report, Blockchain for Government and Public Services, is the latest from the EU Blockchain Observatory and Forum, a body launched in February this year. It highlights blockchain’s capacity to create “trusted audit trails”, “keep data both private and shareable” and the potential to lead to “significant cost savings in data processing while increasing robustness”. Albeit the report urges the “right foundations” need to be put in place, “governments should support the development of user-controlled, “self-sovereign” identity capabilities”.
Many observers once regarded the General Data Protection Regulation (GDPR) as an obstacle to blockchain adoption, but as Céline and the report mentioned above suggest, blockchain and data protection don’t have to be exclusionary. “For me, it’s not a problem, with the GDPR you need to have the possibility to delete personal data, this can be a technical aspect of a public blockchain.”
Céline in her assuredness of blockchain and GDPR coexistence cites a report by the Commission Nationale Informatique & Libertés (CNIL), an independent French regulatory body that ensures personal data and privacy laws are upheld. Published just last month, Blockchain and the GDPR: Solutions for a responsible use of the blockchain in the context of personal data, details issues and solutions in leveraging blockchain technology under European regulations. While the report recommends a case-by-case basis on the “real necessity” of the tech, blockchain enables individuals to be their own “data controller” and exercise their rights to “enable stakeholders to come closer to the GDPR’s compliance requirements”.
Touching upon the ongoing bearish crypto markets, I asked Céline whether she saw greater regulation as a means to a market resistant to, what has been labeled by many as, market manipulation. “I hope so… for me, I’m not a big fan of regulation or too much regulation but we need some. If there is no regulation, people I think, will be a little bit scared, it’s a problem of trust between the people, the community and the technology.”
With prospects of greater regulation on the horizon, Céline considers taxation as a major hurdle for crypto at the moment. “I don’t see it as regulation, the problem for me is the tax system, it’s very difficult to organize an international regulation for taxes,” Céline raises value added tax (VAT) as an example, the level of taxation will depend on how a crypto is classified and then will vary widely between different countries, “there is no international rule, each country has the right to choose their tax system… in Europe it’s impossible, a global system will be even less possible.”
Possibly as a result in differing perspectives toward regulation and taxation, Céline has noticed a shift in her clients from initial coin offering (ICO) to security token offering (STO) objectives, “Six months ago all of my clients wanted to do an ICO, it’s easier, they have a lot of ideas and want to create apps, but now for maybe the last two months my clients want to do STOs.” STOs have a developed system of regulation surrounding them, “as an investor,” Céline explains “it’s better to invest, for me, in an STO because you will have more rights and benefits, but you have to be okay with speculation because it’s an investment and you have to speculate. It’s like a game, sometimes you win, sometimes you lose.”
Wrapping up our conversation I had to ask if Céline feels the cold-hand of automation on her shoulder with smart contracts and their possible integration into the legal industry. “No,” she laughs, Céline actually wants to integrate smart contracts in her practices, “so why not, with the help of crypto and blockchain advisors, create a new protocol for my clients, for my fees for example. If I do the job, I can use a smart contract to obtain my fees, it’s just one example, so no, I’m not scared.”
It was a pleasure speaking to Céline, she is a wealth of information in the ever-shifting crypto and blockchain regulatory space.
If you’re interested in Céline for future speaking events, you can contact her via email: