The European Parliament approves the MiCA regulation, and the global encryption regulatory template is coming?

Original Author: Mary Liu

Original source: BitpushNews

Original Author: Mary Liu

Original source: BitpushNews

On April 20, local time, EU lawmakers voted to pass the Markets in Crypto-Assets (MiCA: Markets in Crypto-Assets) bill, making the EU the first major jurisdiction in the world to introduce comprehensive encryption laws. In a statement, the EU said it hoped the new law would serve as a "global standard setter" for other jurisdictions.The EU Council will hold a formal vote on May 16 to finalize it into law. European Financial Services Commissioner Mairead McGuinness said she expected the legislation to take effect in July after formal approval by the 27 EU member states, with specific provisions to be implemented gradually, for example, rules governing stablecoins would apply from July 2024, while Other requirements will not be enforced until January 2025.BinanceZhao Changpeng

Tweeting commented: "The European Parliament voted in favor of implementing MiCA. This means one of the world's largest markets is introducing tailored encryption regulations to protect users and support innovation. Details matter, but overall we See this as a pragmatic solution to the challenges we all face. There are now clear rules of the game for cryptocurrency exchanges operating in the EU. We are ready to make adjustments to our business over the next 12-18 months, to make it fully compliant".

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What is the point of the new regulations?FTXThe European Parliament stated in a statement that the new rules will impose some requirements on transparency, disclosure, authorization and transaction supervision on encryption platforms, token issuers and traders. Encryption platforms will be required to inform consumers of the risks associated with their operations. Sales of new tokens will also be regulated, and companies will face higher standards of disclosure, including preparing a detailed white paper for each asset offered.

USDCAdditionally, MiCA will require any company offering encryption-related services in the EU to be registered in one of the EU's member states, which will then allow them to operate across the EU. The European Banking Authority and the European Securities and Markets Authority (ESMA) will be responsible for ensuring that crypto platforms comply with the rules, including having adequate risk management and governance processes in order to avoid a recurrence of similar cases.

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For users, one of the biggest changes is that the bill allows the tracking of transactions over 1,000 euros ($1,097.55), from self-hosted wallets to centralized wallets, such as those hosted on cryptocurrency exchanges. The aim is to help combat money laundering, requiring services to screen, record and communicate information about senders and receivers. These rules do not apply to peer-to-peer transfers or transfers that do not involve a centralized wallet.

MiCA also addresses environmental concerns surrounding encryption, with companies required to disclose their energy consumption and the environmental impact of digital assets. This is a compromise move after lawmakers removed a blanket ban on proof-of-work mechanisms from an earlier draft.

first level titleOne step ahead of the United States, will the EU become the benchmark for other countries' regulation?Bittweet previously reported that MiCA, first proposed in 2020, was cheered by those in the encryption industry compared to law enforcement in the United States instead of regulation.Christine LagardeEuropean Central BankCelsiuspresident

Also an important supporter of MiCA, but since the bill does not cover encrypted lending, decentralized finance (DEFI) and non-fungible tokens (NFT), in Luna, FTX,

After projects like Voyager and Voyager imploded, Lagarde called for a proposed "MiCA II" to build on the new law.CoinbasePitchBook data shows that Europe has been taking market share of crypto venture capital from the United States, and venture capital investment in European crypto projects has increased rapidly in the last quarter.KrakenU.S.-based crypto firms have been looking to expand overseas in response to stringent regulatory moves in their home country. cryptocurrency exchangeRippleand

Recently acquired a virtual asset service provider license in Dublin. blockchain companyBrian ArmstrongPermission from the Central Bank of Ireland is being sought.SECEarlier this week, Coinbase CEO

) in a "year-long" legal battle. If regulatory clarity in the U.S. persists, Coinbase will consider options for investing more overseas, including moving out of the U.S.

Alisa DiCaprio, chief economist at enterprise blockchain firm R3, commented that a harmonized EU-wide regulatory framework could make the bloc more attractive to digital asset firms and force other jurisdictions to follow suit. "It will be a 'surprise' if other jurisdictions, such as the UK and the US, do not quickly follow suit and further accelerate their cryptocurrency regulatory efforts," DiCaprio said.

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The MiCA Controversy

Critics say forcing exchanges to provide authorities with sender and recipient information on each transaction and placing special scrutiny on self-hosted wallets that send more than 1,000 euros ($1,097) undermines the integrity of encryption. anonymity.XapoThere are also concerns that MiCA could impose an administrative burden on companies, which have a year or two to digest the terms. Nana Murugesan, vice president of business development at Coinbase, told Bloomberg that the lengthy revisions and delayed implementation of MiCA have left crypto firms in a “transition period” where they need to seek licenses in multiple EU countries until the pass takes effect.DeFiMiCA does not provide regulatory clarity for NFT and DeFi businesses. Bitcoin Custodian

Joey Garcia, Bank’s head of public affairs, said that while he welcomes raising standards for digital asset service providers, he is concerned that MiCA will regulate the asset class too strictly. He wrote: "The

What is the impact of integration and cross-chain? Likewise, while the classification of virtual assets in the new category is also constructive and forward-looking, are the rules truly in line with the industry? "LCXDea Markova, managing director and head of digital assets at Forefront Advisers, wrote that the European Commission set MiCA to regulate token issuers as entities, rather than token transactions as activities. That said, the requirement is for issuers regardless of how their tokens are used, which limits the forward-looking nature of MiCA.