MiCA Regulation Is Officially Approved
The European Parliament has approved the Markets in Crypto Assets (MiCA) law, which will enable the European Union to regulate the cryptocurrency industry in its efforts to combat money laundering and the financing of terrorism.
With 517 votes in favor, 38 against, and 18 abstentions, the law will provide a unified approach to crypto asset regulation across all 27 member states, focusing on crypto-asset service providers (CASPs) such as trading platforms and marketing crypto assets. The Transfer of Funds regulation was also passed, which will require crypto operators to identify customers in a bid to curb money laundering.
The MiCA legislation will come into effect after approval by the European Council, with rules for stablecoins applicable from July next year and the rest not until January 2025. The EU’s securities regulator, the ESMA, will be responsible for the details of how the new rules will be applied.
Why Does It Matter?
The approval of the MiCA law is a milestone in the EU’s efforts to regulate the cryptocurrency industry. Kraken’s Head of European Operations, Mark Jennings, says it is a “bespoke and pragmatic blueprint for crypto assets to evolve within a regulatory perimeter.”
It could soon become a universal standard for customer protection and business efficiency if the EU can get the technical implementation of this framework right. The law has been praised for its regulatory clarity. Stefan Berger, the spokesperson for the Group of the European People’s Party, states that the European crypto-asset industry has regulatory clarity that countries like the United States do not have.
Overall, the MiCA law is a positive step towards establishing a safer and more secure cryptocurrency industry in the European Union.