As was reported last week, the European Parliament approved MiCA, or Markets in Crypto-Assets legislation, which aims to make the EU a digital asset-friendly jurisdiction. At the same time, the Transfer of Funds regulation was approved, which requires crypto operators to identify their customers as part of KYC/AML compliance.
CI has received multiple comments from various insiders, with two more shared below.
Katharine Wooller, Business Unit Director at Coincover, says MiCA ends the era of “patchwork” regulation across the European Union where each member state approved digital asset regulation differently. MiCA will deliver “much-needed clarity” for the EU.
“As the first region to bring a coherent and comprehensive framework, this should be praised, and I would expect crypto firms in the less welcoming regulatory climes, particularly the US, to migrate to the area. This puts the UK, similarly, under significant pressure to follow suit – the FCA’s attempts to regulate the space so far have been lacking in speed, scope, and enthusiasm.”
Wooller added that MiCA has been well received by the industry, and there are many businesses in the digital asset sector calling for regulatory oversight.
“It provides credibility to a nascent industry and confidence for both retail and institutional audiences. I expect to see an increase in demand for tech solutions that enable compliance, by managing risk; these solutions have long been available and the regulation makes their adoption necessary rather than a ‘nice to have’. MiCA will make Europe the tech hub it deserves to be and is good news for all participants that choose to do business there.”
Bradley Duke, co-CEO at ETC Group, echoed the fact that MiCA makes the EU the first major jurisdiction in the world to introduce a comprehensive crypto law. Duke said the ETC Group applauds the approval of MiCA.
“We have seen that when individual countries in the EU put in place a cohesive regulatory framework for companies working with digital assets, it encourages growth, innovation, and job creation through the certainty and stability that sensible regulation brings. This also translates into far greater investor comfort knowing that their regulator is engaging with the asset class in a positive way and is implementing protections for their benefit. The fact that a framework for investor protection and stability within digital assets will soon be in place across the EU is a massive boost for the digital assets sector within Europe.”
Duke also highlighted the contrast to the situation in the US where the SEC has taken an openly hostile stance against companies trying to operate legitimately within the space while simultaneously doing next to nothing to actually put in place a functional regulatory framework.
“The opportunity for Europe to now become the world’s digital assets hub is very clear.”
As Congress is expected to pursue comprehensive digital asset legislation the US may yet provide clearly defined rules. Yet the fact the SEC has pursued a policy of regulation by enforcement will force the US to play catch-up to the EU and other jurisdictions.
