EU lawmakers recently passed the Markets in Cryptocurrency Act, also known as MiCA regulation, to introduce new requirements on blockchain platforms.
The EU parliament passed the first all-inclusive framework for controlling blockchain platforms, voting through the MiCA Crypto Regulation with only 38 votes against out of the total 555 (if you into sports betting – check blockchain sports betting sites).
This legislation aims to minimise risks for crypto assets consumers, placing liability on blockchain and cryptocurrency providers if their customers lose their assets (read more about crypto sports betting).
The EU is the first market to regulate cryptocurrency transfers, placing it a step ahead of other leading blockchain markets in introducing safeguards for consumers.
This MiCA legislation puts the EU a step ahead of the blockchain token economy, with over 10,000 different cryptocurrency assets. Investors will be protected against fraud and deception, meaning the industry that the FTX collapsed damaged can regain trust.
FAQ
What does MiCA Crypto stand for?
MiCA stands for Markets in Crypto-Assets.
What is MiCA Crypto Regulation?
The goal of MiCA markets in crypto assets regulation is to reduce the risk for individuals using cryptocurrency by holding blockchain and cryptocurrency providers responsible for any loss of assets experienced by their customers.
Why Crypto regulation is bad?
Imposing stricter regulations will come with immediate drawbacks: it will prevent some promising projects from securing funds through the unregulated ICO model, and it will once again limit the ability of less affluent investors to invest in early-stage ventures due to accreditation requirements.
What happens if cryptocurrency is regulated?
The cryptocurrency market will remain highly unpredictable and risky despite the new regulations. However, the rules may help prevent people from falling for manipulative advertising and give them repeated warnings about the risks of investing in crypto.
Is Markets in Crypto Assets MiCA approved by the EU?
On Thursday, April 20th, 2023, the EU Parliament passed the Markets in Crypto Act or MiCA EU regulation. The legislation aims to decrease consumer risks when purchasing crypto assets, holding providers accountable if they lose investors’ crypto assets.
The Markets in Crypto Assets regulation law provides a competitive advantage for the European Union since the sector will start to experience significant shifts of customers from less regulated countries such as the United States and the United Kingdom.
After the EU MiCA regulation news, a United Kingdom official reported that specific cryptocurrency regulations could be on the way within the next one year.
Authorisation and supervision of crypto transactions are among the key operational areas that the Markets in Cryptocurrency Act will control, with crypto token and coin providers needing to ensure security and transparency with investors.
What is more? The new regulation will aim to support integrity in the crypto market by managing crypto assets offers while introducing measures to help mitigate against terrorism financing and money laundering.
Based on the Markets in Cryptocurrency Act, The European Markets and Securities Authority has the power to create a public register for all non-compliant blockchain assets that operate in the European Union without authorisation.
Large crypto providers will also need to disclose their respective energy consumptions as part of the European Union’s efforts to minimise crypto’s high carbon footprint. The second law on digital asset transfers will result in greater oversight of blockchain asset traders and providers, bringing it closer to practices in fiat/traditional finance.
The EU is sure that this will make it more difficult for criminals to use crypto for illegal activities. For over ten years, the lack of crypto industry regulation has led to huge losses to millions of first-time customers and provided a safe platform for international criminal networks and fraudsters.
Once this regulation comes into effect, cryptocurrency providers will need to obtain licenses from the EU and use them in any European country they want to offer their services.
The Markets in Cryptocurrency Act mirrors the EU’s huge transition into digital error. Crypto assets have always needed a robust regulatory framework that ensures a fair playing field and offers important consumer protection. MiCA’s approval means that the blockchain industry has had this vital affirmation.
It makes Europe fit for digital error and will boost fair competition and innovation in the blockchain assets industry, resulting in increased investor and consumer protection as well as overall financial stability.