The European Union is introducing new regulations for cryptocurrencies with the Markets in Crypto-Assets, or MiCA, legislation, which aims to provide a regulatory framework for cryptocurrencies and stablecoins in the bloc.
The new regulation was voted in the EU Parliament on Thursday in favour of the crypto licensing regime which aims to promote innovation while protecting investors and consumers.
The ambitions new regulatory framework will allow cryptocurrency service providers, including exchanges, wallet providers to offer regulated services in Europe and will require them to identify their customers to safeguard against money laundering.
In a tweet, European Financial Services Commissioner Mairead McGuinness said the vote was “a world first” and that the new regulation can come into effect in July after approval from all member states. Some of the rules will take effect in time with some set for 2024.
She stated:
I welcome the European Parliament’s vote today to approve comprehensive EU rules on crypto: a world first. The rules will start applying from next year. We’re protecting consumers and safeguarding financial stability and market integrity.
The approval vote on Thursday is is a significant milestone for the crypto industry. This move comes after the downfall of several major players, including the crypto exchange FTX.
Stefan Berger, the lawmaker who led negotiations on the law, said in a statement released by the European Parliament:
This puts the EU at the forefront of the token economy with 10 000 different crypto assets. Consumers will be protected against deception and fraud, and the sector that was damaged by the FTX collapse can regain trust. Consumers will have all the information they need and all underlying risks around crypto-assets will have to be monitored. We secured that the environmental impact disclosure will be taken into account by investors in crypto assets. This regulation brings a competitive advantage for the EU. The European crypto-asset industry has regulatory clarity that does not exist in countries like the US.
