New crypto law EU requires “self-destruct button” in apps

The European Union is working hard on new legislation regarding cryptocurrencies and the digital economy. For example, the new MiCA legislation has been officially adopted and a new form of the euro will be introduced. There will also be a new law regarding how devices connected to the internet may collect data. This appears to contain a controversial function for blockchains.

EU wants continue with ‘crypto kill switch’

On Twitter, Thierry Breton of the European Commission writes that policymakers within the EU have agreed on the ‘Data Act’. This should ensure that the data economy of the future “remains open and innovative, but on our terms,” said the French commissioner. For the time being, it is still a draft law, which must be checked several times and passed the European Parliament before it becomes an official law.

A draft version of the law has not yet been published, but CoinDesk learned from his own sources that a section was about smart contracts. After all, with smart contracts it is possible to interact on blockchains in a decentralized and even automated manner. The EU also seems to be slowly coming to the conclusion that blockchains will probably be part of the future.

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But ‘on our terms’ in this case means that a very draconian function will be added to the government’s box of tricks, namely a ‘kill switch’. In 2022, the EU found that automated software products that exchange data should be able to be discontinued in a safe manner. This should be handled in the smart contract itself.

Crypto industry doesn’t like killswitch

Last March, the first bill related to smart contracts was unveiled. The crypto industry considered it a far-reaching measure that ignores the principles of blockchain and goes beyond its decentralized nature.

It seems that developers themselves will be required by law to make software adjustments. According to critics it will be impossible to comply with this, because it is very complicated. But according to the European Commission, the industry has nothing to worry about. Existing smart contracts without these kill switches will remain legal.

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