This September the European Commission (EC) adopted a new Digital Finance Package, including a digital finance strategy and legislative proposals on crypto-assets and digital resilience.
This legal framework has a proposal regarding cryptocurrencies: Markets in Crypto-assets (MiCA), which gives definition to cryptocurrencies, stable coins.
Some experts are worried that MiCA will regulate crypto space as strictly as financial services and will threaten the existence of different cryptocurrency instruments like DeFis in the EU market. MiCA aims to provide a single licensing regime for crypto projects across all the EU member states by 2024.
I have asked the opinion on the MiCA draft and how it will affect the crypto landscape in Europe from the businesses who already are compliant to existing regulation for financial services and have licenses for crypto activities.
Here you can read the opinions on upcoming EU crypto regulations from VK, founder of Estonian crypto exchange STEX and Tobias Hermansen, Coinify Corporate Counsel (Coinify even consulted EuroCommission regarding upcoming regulations).
– It has now become obvious that the cryptocurrency market is going to become fully regulated in Europe. Are we jumping to the future or sliding backwards to the Medieval Era of Finance like a lot of people say?
TH: Well, this is interesting. While the regulation is new and revolutionary a large part of the proposed regime is based on already existing rules from markets in financial instruments and prospectus regulation.
The regulation includes articles on licensing, supervision, market-abuse, insider trading, publication of white paper and more. I believe that this proposed regime will legitimize the cryptocurrency industry.
A number of actors, including ourselves, have already been applying many of the current financial regulatory standards to their business, but without a public and approved framework it is difficult to move away from the predetermined attitudes towards cryptocurrency.
Furthermore, the regulation shows great knowledge of the different business models within the industry and many of the rules have been amended and customized to fit cryptocurrency transactions and services.
We are aware that some rules are not feasible for the industry, but the commission is actively seeking inputs from the cryptocurrency market, and will amend the proposed regulation in order to provide the best regulatory framework.
At Coinify we are excited about this new proposed regulation and believe that it will help move cryptocurrency towards a mainstream adoption.
VK: I’ll be the optimist here. As a society, that is now eager to accept innovative payment methods not only as a phenomenon, but also creating a legal field for them is jumping to the future for sure.
That is exactly why STEX was amongst the first to comply and support all the regulatory innovations in Estonia in 2020.
Speaking of the Medieval Era: current situation with fiat flow of funds aka…