From soup to nuts of ‘agreement reached on European crypto-assets regulation’
As the rest of the cryptocurrency market gradually moves on from the aftermath of the collapse of Terra’s LUNA and UST, regulators across the globe have become increasingly skeptical of digital assets and the risks they pose to investors.
On 30 June, the European Commission, lawmakers within the European Union (EU), and member states reached an agreement on the body of laws to regulate player activities in the cryptocurrency market.
Referred to as Markets in Crypto-Assets (MiCA), the proposed legislation is “aimed at issuers of unbacked crypto-assets, and so-called ‘stablecoins,’ as well as the trading venues and the wallets where crypto-assets are held.”
According to the announcement blog by the Council of the EU,
“Regulatory framework will protect investors and preserve financial stability while allowing innovation and fostering the attractiveness of the crypto-asset sector. This will bring more clarity in the European Union, as some member states already have national legislation for crypto-assets, but so far, there had been no specific regulatory framework at EU level.”
According to the announcement blog, the proposed MiCA is targeted at protecting consumers. The laws aim to protect consumers “against some of the risks associated with the investment in crypto-assets, and help them avoid fraudulent schemes.” Placing an onerous duty on crypto-asset service providers, with MiCA, centralized and decentralized exchanges, DeFi protocols, crypto lending platforms, and other service providers “become liable in case they lose investors’ crypto-assets.”
According to the Council of the EU, the proposed MiCA will also correct the environmental issues related to crypto mining activities. The legislation will require players within
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