The European Union has adopted the “MiCA” regulation regarding the crypto market. It must be approved by the European Parliament and the European Council before entering into force in 2024.
MiCA set up from January 2024
The European Union finally validated the regulation on the crypto-asset markets through the European Council. This is the final version, which has been approved by the European Council.
The MiCA regulation must be approved by the Economic Affairs Committee of the European Parliament on October 12 for final approval. The MiCA Regulation and all its provisions will be implemented from January 2024. It is unlikely that the provisions will enter into force earlier.
“The MiCA regulation having been the subject of a political agreement by the various parties concerned in June 2022, the European Parliament should unsurprisingly approve the text. Then, once the MiCA regulation is translated by lawyers and linguists and published in the Official Journal of the European Union, the countdown to its application will begin. »
Digital asset service providers (PSANs and others) registered with EU regulators will have an additional 18 months to achieve compliance. Some companies have been recording at a brisk pace lately, especially in Italy, and the information has not escaped.
With an EU passport, companies can target customers from other EU countries without having to comply with national regulators. For example, a company registered with the AMF may market to customers in European Union countries.
Much of the current debate around DeFi centers around the unclear definition of the term. Since this distinction is vital for many DeFi projects, various organizations and institutions are debating its meaning. This includes discussions of DeFi protocols, DAOs, and other related projects.
The MiCA legislation considers certain NFTs as financial assets – under certain conditions. He is also considering banning companies from paying their customers with stablecoins. Additionally, the regulation considers algorithmic stablecoins for its regulation, as well as the inclusion of other types of stablecoins.
Allow investors to avoid scams
The MiCa Regulation aims to protect investors by regulating the crypto industry. It was initially approved by the European Parliament and the Council in July 2017.
The French constitution uses the term PSAN for digital asset service providers. It requires these service providers to obtain a license from the local authorities within 2 months. MiCa sends SMS to service providers with the name CASP-Crypto-Asset Service Providers instead of PSAN. It takes at least 15 million users for a company to be considered a PSAP.
Since the Pacte law was passed by Congress, the AMF can now register or approve crypto companies operating in France. So far, 52 companies have been registered; including recently Crypto.com, Société Générale Forge and Binance. Despite this, no approved company has obtained approval. This is because the AMF needs the cooperation of the Central Bank to approve new companies.
The Brussels-brokered settlement aims to protect “investors from the dangerous risks associated with investing in crypto-assets”. This allows them to avoid operating systems that exist only to rip them off.
The negotiations in Brussels are taking place in a particular context, the last two cryptocurrency crashes having taken place in May and June. During these periods, some assets are weaker than others, including some so-called “algorithmic” stablecoins, such as the collapsed Terra blockchain stablecoin terra USDT (UST).