The European Union has taken a major step forward in the regulation of crypto-assets with the approval of the Markets in Crypto-Assets Act (MiCA).
This legislation aims to set a standard regulatory infrastructure for cryptocurrencies, creating certainty for investors and institutions in the industry.
With the passage of MiCA, policymakers, and regulators will work together to establish a set of regulations for cryptocurrency assets across the European Union.
MiCA will provide guidelines for the operation and issuance of digital assets, creating a more stable and secure environment for investors.
The Act will also eliminate the need for investors and service providers to navigate the rules of 27 different national regulatory bodies. This will simplify the authorization process for Crypto Asset Service Providers (CASPs) operating in the EU single market.
The passage of MiCA has been hailed as a milestone for the crypto-asset industry. The Act has been in development since 2020 and is expected to have some regulations come into effect as early as 2024, with others following in 2025.
Stablecoins, which have been the subject of much debate in recent years, are expected to be among the first assets to be regulated under MiCA.
While national competent authorities will continue to supervise CASPs, the European Securities and Markets Authority will have new responsibilities for the significant CASPs, those serving a daily average of more than 15 million active users in a year.
The passage of MiCA will create a more unified regulatory environment for crypto-assets across the European Union, which is likely to encourage further investment in the sector.
