Daily Management Review

EU Is Attempting To Reach An Agreement On Groundbreaking Crypto-Regulation Laws


EU Is Attempting To Reach An Agreement On Groundbreaking Crypto-Regulation Laws
The European Union will seek agreement on ground-breaking rules for regulating crypto assets on Thursday, as the bitcoin crash increases pressure on authorities to rein in the sector.
Globally, crypto assets are generally unregulated, with national operators in the EU simply obliged to demonstrate anti-money laundering safeguards.
A deal would put the EU ahead of the global regulatory pack by providing issuers of crypto assets and suppliers of associated services with a "passport" that would allow them to serve clients across the EU from a single location while meeting additional capital and consumer protection regulations.
Officials in the industry believe that rule clarity and passporting could entice crypto businesses to relocate from competitor London. The United States and the United Kingdom, two crypto hubs, have yet to approve such regulations.
Representatives from the European Parliament and EU member states are meeting to negotiate a settlement on the markets in crypto assets (MiCA) regulation, which is slated to go into effect at the end of 2023.
According to a source close to the negotiations, three difficulties remain: non-fungible tokens (NFT), supervision, and energy use.
A deal is anticipated to focus on including only token-like NFTs in the scope of MiCA, with crypto companies authorised and supervised at the member state level. According to the source, the European Commission will analyse the energy footprint of crypto assets.
Firms operating in an EU member state would have 18 months following the commencement date to get a MiCA licence without causing service disruption.
Following the collapse of TerraUSD and luna tokens last month, crypto assets have been under pressure, with major US cryptocurrency lending company Celsius Network halting withdrawals and transfers this month. more info
Bitcoin fell to roughly $17,600 this month and is now trading around $20,100, significantly below its late March level of $48,200, leaving investors with losses.