In a recent announcement, the Luxembourg competition authority declared its intent to launch a market study into blockchain technology, marking a potential first-of-its-kind investigation into the economics of Web3. Luxembourg, an esteemed European Union (EU) member and notable financial center, has identified the technology behind cryptocurrencies as a vital component in the digital and environmental landscape.
With increasing attention on the emerging sector, the Autorité de la concurrence emphasized the importance of ensuring a competitive and efficient market for Web3 actors to grow. A competition market study enables regulators to gather information from active companies within the industry, helping to uncover market mechanics. These studies may later form the basis for enforcement actions against potential breaches of antitrust rules, such as abuse of a dominant position.
This specific study aims to evaluate the extent and manner in which up-and-coming blockchain-based companies compete with their established Web2 counterparts. Additionally, the investigation will scrutinize any potential anti-competitive practices implemented against Web3 projects. According to Thibaut Schrepel, an associate professor at the University of Amsterdam who will assist the probe as an external expert, this undertaking signifies a significant milestone.
In his words, “To the best of my knowledge, it’s the first market study conducted by a regulatory agency whose goal is to protect Web3, not to attack it.” This contrasts with the more common stance of regulatory authorities that focus on scrutinizing and reining in the novel technology rather than supporting its growth.
On a broader scale, the European Commission is set to issue a policy paper on the metaverse later this year. This paper is expected to deliberate on potential measures to address concerns if major companies, such as Meta Platforms, stifle competition by squeezing out smaller rivals.
As the Luxembourg competition authority embarks on this pioneering market study, it reflects the changing attitudes towards blockchain and cryptocurrency. The probe will shed light on the potential obstacles faced by Web3 projects and examine the relationship between traditional internet companies and their innovative counterparts. Though this may be the first of its kind, it’s unlikely to be the last as the regulatory landscape evolves to address this rapidly advancing technology.
Source: Coindesk
