European Parliament Approves MiCA Legislation

  • Lawmakers in the European Parliament voted 517-38 in favor of the MiCA legislation, which aims to establish harmonized rules for crypto in the EU.
  • The crypto regulatory package still needs the approval of the European Council, but it is expected to come into force in 2024.
eu

Shutterstock

Lawmakers in the European Parliament have voted strongly in favor of the Markets in Crypto Assets (MiCA) Act, the first comprehensive rules for crypto and crypto asset services providers in the EU.

According to a press release from the Parliament on 20 April, lawmakers voted 517-38 in favor of the MiCA licensing regime, which aims to establish regulatory clarity for cryptocurrencies on the level of the European Union. Once it becomes effective regulation, MiCA will set up guidelines for the operation, structure, and governance of digital asset issuers. Stefan Burger, a leading member of the European Parliament, said in a statement:

“This puts the EU at the forefront of the token economy with 10 000 different crypto assets. Consumers will be protected against deception and fraud, and the sector that was damaged by the FTX collapse can regain trust. Consumers will have all the information they need and all underlying risks around crypto-assets will have to be monitored.”

The Parliament’s lawmakers also voted 529-29 in favor of a different law, known as Transfer of Funds regulation, which will require operators of crypto companies to identify their customers in order to reduce the use of crypto for money laundering.

Introduced back in 2020, the MiCA regime still needs approval from the European Council before it becomes an effective regulation, but once it comes into effect market participants will no longer need to navigate 27 sets of different national rules. The stablecoin-related provisions of MiCA are expected to come into force in July 2024, while all other provisions will apply starting January 2025.

While many have touted MiCA as a “milestone” for the crypto industry, there are certain areas in which the regulation is lacking. While it establishes general rules for crypto and crypto asset service providers, the 400-page document lacks any mention of decentralized finance (DeFi), crypto lending and staking, or the growing non-fungible token (NFT) market.

Discussion
Related Coverage
DoJ Says Lack of U.S. Crypto Laws Irrelevant in SBF Lawsuit
  • Sam Bankman-Fried’s legal counsel had claimed he should not be charged with any crimes involving FTX as it was not regulated in the U.S., only FTX.US was.
  • The DoJ said the claim was irrelevant as SBF was charged for violating existing laws for misappropriating customer assets.
October 4, 2023, 12:18 PM
sbf

Former CEO of FTX Sam Bankman-Fried leaves the Federal Court in New York after pleading not guilty, 3 January, 2022.
lev radin/Shutterstock

U.K. Regulator Shut Down 26 Crypto ATMs Since Start of 2023
  • The U.K. Financial Conduct Authority continues its crackdown on crypto ATMs in the country, and has disrupted a total of 26 machines since the start of the year.
  • The regulator warned the public back in March 2022 that all crypto ATMs in the country were operating illegally, and issued a “shut down or face further action” order.
Australian Regulator Reportedly Searched Binance’s Offices
  • Anonymous sources have said that the offices of Binance Australia were searched on Tuesday as part of an ongoing investigation into the exchange’s derivatives operations.
  • Australia’s financial regulator, who conducted the reported search, canceled Binance Australia’s derivatives license back in April, and the exchange no longer offers the service in the country.