CySEC Chair Discusses AI, Stablecoins, and Future Regulations

​Dr. George Theocharides, Chair of the Cyprus Securities and Exchange Commission (CySEC), has outlined the regulator’s priorities for the coming years, emphasizing a measured approach to new technologies and evolving market structures. Speaking to Finance Magnates, Theocharides stated that the European Union’s AI Act is “only the beginning,” anticipating further guidelines from supervisory bodies to address AI use within regulated entities.

On the topic of crypto-asset regulation, Theocharides confirmed that CySEC is currently reviewing multiple applications under the Markets in Crypto-Assets Regulation (MiCA). He noted that the commission is “not in a rush,” prioritizing thorough vetting over speed. He added that firms already holding a MiFID II license face a simpler process when applying for MiCA authorization, as they have previously undergone rigorous assessments.

The Chair also highlighted concerns regarding the financial stability risks posed by stablecoins, noting the market concentration around major assets like Tether and USDC. “We recognize the benefits of stablecoins, but we must also remain cautious because they pose certain risks... particularly to financial stability,” he said.

Addressing the rise of proprietary trading firms, Theocharides indicated that while the sector is “on the radar,” there are no immediate plans for concrete regulation from Europe. However, he suggested that if the industry continues to grow, future rules might follow a trajectory similar to the regulation of copy trading.

Regarding the persistent challenge of investment fraud, Theocharides offered a candid assessment: “Honestly, at least for now, no matter what we do, there will always be someone who finds new ways to deceive investors.” He affirmed that while regulators strive to make fraud as difficult as possible, completely eradicating it remains unlikely.