The EU Parliament and Member States are considering proposed MiCA regulations that aim to support crypto-asset technologies while protecting users.
MiCA Regulations on EU Crypto
Cryptocurrency entities are closely watching proposed regulations making their way through the legislative process in Europe. As well they should — the so-called Markets in Crypto-Assets (MiCA) rules very likely may alter the crypto landscape on the continent.
First, a little background. The European Union is developing MiCA to increase the potential of cryptocurrency assets and reduce possible risks. The European Commission’s plan has been examined and modified by the MEPs, and in June 2022, Parliament and the Council came to a preliminary agreement. The rules are currently awaiting final approval from the Parliament and EU Member States.
In order to encourage the development and use of these technologies, MiCA aim to provide legal certainty, support innovation, protect consumers and ensure financial stability.
Transparency, disclosure, authorization, and oversight of transactions will be all covered under the new legislation. Moreover, due to the growing fears of governmental institutions about financial fraud, a number of MEPs have recently raised their voices in favor of having the European Securities and Markets Authority and the European Banking Authority regulate various tokens.
This regulation, if approved, would have a huge impact on Businesses dealing with crypto-assets in the EU, requiring them to provide a better set of information to consumers about risks, costs and charges.
In March 2022, the EU Parliament also passed regulations regarding the use of blockchain and other distributed ledger technologies for the trading of cryptocurrencies. This law aims to promote the creation of innovative solutions for trading platforms dealing with crypto-assets while upholding high standards of monetary stability, openness, and market integrity.
The question now is: How will this regulation impact economically the cryptocurrency market?
Different analysts consider a reliable set of rules to be the springboard to boost the use of crypto-assets. Meanwhile, others have more critical positions, saying that regulations will distort market mechanisms and that the reliability of crypto-assets is intrinsic to the system.
Although it has yet to be approved, the MiCA regulation is already making news. The next few months will be crucial to understand if there will be other amendments, what the reactions of the market will be, and if the EU Parliament will finally vote for its adoption.
Source : bsc.news
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