The European Commission has proposed a pilot project on blockchain or distributed ledger technology with regard to regulation.

In a draft communication to the European Parliament, the Council, the European Central Bank, the European Economic and Social Committee and the Committee of the Regions, the Commission said that the pilot project would particularly focus on improving the knowledge and creating awareness of the technology among the EU's regulators, CoinDesk reported.

Dated 23 March, the document also said that the Commission is launching a public consultation in order to receive inputs from stakeholders to further develop its policy approach towards technological innovation in financial services. Importantly, it said that the consultation is structured along four broad policy objectives that reflect the main opportunities and challenges related to Fintech:

“Fostering access to financial services for consumers and businesses; (2) Bringing down operational costs and increasing efficiency for the industry; (3) Making the single market more competitive by lowering barriers to entry; and (4) Balancing greater data sharing and transparency with privacy needs

"This work will also benefit from specific funding from the European Parliament for a pilot project aimed at reinforcing the capacity and technical expertise of national regulators with regard to distributed ledger technology”, the Commission said.

The Commission said that it has launched an internal FinTech Task Force focused on financial regulation, technology, data, and competition. It added that on the basis of the work of the task force and the public consultation, it will determine which actions are required to support the development of FinTech and a technology-driven Single Market for financial services.