European Council agrees to crypto asset regulations
Friday, May 19, 2023
The European Council, representing European Union (EU) member states, approved the Markets in Crypto Assets (MiCA) regulations on Tuesday, which Reuters described as the first regulations of such depth in the world.
Council approval for MiCA, which the European Parliament passed in April, set the regulations, in the legislative process since 2020, for a phased rollout from July 2024.
Finance minister of Council president Sweden Elisabeth Svantesson said: "Recent events have confirmed the urgent need for imposing rules which will better protect Europeans who have invested in these assets, and prevent the misuse of crypto industry for the purposes of money laundering and financing of terrorism".
Under the new rules, companies issuing, trading in, and insuring crypto assets, including stablecoins, would need a licence to operate within the EU; if "noncompliant", the bloc would publicly name them.
Lawmakers designed the new regulations to preserve stability in markets while reducing manipulation and insider trading, according to the Associated Press.
MiCA would establish firms' liability for losses and require them to disclose risks for investors and fees.
Under rules slated to take effect in January 2026, companies must record parties to crypto transfers, which Reuters said would aid enforcement of taxation and anti-money laundering laws.
MiCA would extend members' cooperation on taxation to crypto.
The Council's approval came as several crypto entities have collapsed, including exchange FTX, which went bankrupt, and the TerraUSD stablecoin; some enterprises have urged international consistency in regulations.
The United Kingdom has stated its intention to regulate stablecoins, then uninsured assets, and is in the process of considering feedback on policies the government proposed last year.
Hester Peirce, a commissioner of the United States' Commodity Futures Trading Commission regulator, stated officials at various levels of government in his country were investigating their role in the market, telling a conference: "We are wandering in the desert a bit".
- "UK Treasury considering plans for digital pound, economic secretary says" — Wikinews, January 16, 2023
- Huw Jones. "EU states approve world's first comprehensive crypto rules" — Reuters, May 16, 2023
- "Crypto rules get final approval to make Europe a global leader on regulation" — AP News, May 16, 2023