The rise of cryptocurrencies has presented numerous challenges to regulators worldwide. These assets have made it difficult to create effective regulatory frameworks. However, the European Union has taken a step forward and decided to address these challenges through the introduction of the “Markets in Crypto-assets (MiCA) Regulation”.

In IATE, we can find this term defined as a “legal act proposed by the European Commission under its autumn 2020 digital finance package, with four objectives in mind: to define the regulatory treatment of all crypto-assets that are not covered by existing financial services legislation, to support innovation, to instil appropriate levels of consumer and investor protection and to ensure financial stability”.

The main goal of the MiCA regulation  is to establish a comprehensive regulatory framework for cryptocurrencies in the EU. The regulation was proposed in September 2020, and it is expected to come into effect in 2024. It aims at covering all digital assets that are not currently regulated under existing EU financial regulations.

The regulation will introduce several measures to protect consumers and ensure market stability. For instance, it will require issuers of crypto-assets to provide investors with detailed information about the assets, such as their price and performance history. It will also will establish a set of common rules for crypto-asset service providers, such as exchanges, custodians, and wallet providers.

The impact of the MiCA regulation on the EU’s crypto market is expected to be significant. The regulation will increase transparency and accountability, making it easier for consumers to invest in crypto-assets with confidence.

References

Browe, R. (2023, April). CNBC. Retrieved from EU lawmakers approve world’s first comprehensive framework for crypto regulation: https://www.cnbc.com/2023/04/20/eu-lawmakers-approve-worlds-first-comprehensive-crypto-regulation.html

Council of the European Union. (2022, October). Retrieved from Proposal for a Regulation of the European Parliament and of the Council : https://data.consilium.europa.eu/doc/document/ST-13198-2022-INIT/en/pdf

European Parliament. (2023, April). Markets in crypto-assets (MiCA). Retrieved from BRIEFING – EU Legislation in Progress: https://www.europarl.europa.eu/RegData/etudes/BRIE/2022/739221/EPRS_BRI(2022)739221_EN.pdf

European Parliament. (2023, April). Press room. Retrieved from Crypto-assets: green light to new rules for tracing transfers in the EU: https://www.europarl.europa.eu/news/en/press-room/20230414IPR80133/crypto-assets-green-light-to-new-rules-for-tracing-transfers-in-the-eu

Morales, J. (2023, April). Be In Crypto. Retrieved from Will MiCA Become the Global Standard for Crypto Regulation?: https://beincrypto.com/will-mica-become-global-standard-for-crypto-regulation/

Schickler, J. (2023, April). EU Parliament Approves Crypto Licensing, Funds Transfer Rules. Retrieved from https://www.coindesk.com/policy/2023/04/20/eu-parliament-approves-crypto-licensing-funds-transfer-rules/

Written by Carmen del Campo Hermida

Born in Madrid, Spain, Carmen holds a Double Degree in Translation and Interpreting and Bachelor in Global Communication. She has also studied a Degree on Content Marketing and Social Media. She has been combining her studies with some part-time jobs, which has allowed her to appreciate little things in life, such as spending time  with her family and friends and enjoying her hobbies. She is keen on learning from other people and cultures and wishes to get to travel around the world someday.