Europe’s Data Act has forced the blockchain industry in Europe to take final steps to prevent the law from destroying the smart contracts that support decentralized protocols. The Data Act which is set to be concluded by the end of June is currently being discussed and aims to control the data that is being shared between smart devices within the Internet-of-Things networks. The decentralized finance sector frets that the law’s article about regulating smart contracts does not provide enough information on what it will cover.
The European Data Act was formally proposed on 23 February 2022 with an aim to improve the quality as well as transparency of the federal government’s award data.
Advocates like the European Crypto Initiative that hold up the use of blockchain technology are warning policymakers about how their decisions impact blockchain developers and could kill DeFi in the bloc.
Marina Markezic, who is in charge of the European Crypto Initiative, said that the worst thing that could happen is that we won’t be able to use public blockchains for using smart contracts while also following the rules of the Data Act.
The trade association sent a policy paper to more than 100 decision-makers, saying that Europe should not harm innovation and technological progress in the wider blockchain industry by making a mistake that will hurt itself.
The European Union might impose very strict rules on decentralized protocols that use smart contracts if the regulators don’t explain the limitations of the Data Act. The crypto industry is going all out in order to prevent this from happening in the final stages of the discussion between the European institutions.