ECB Officials Prepare To “Harmonize” Crypto Regulations• July 5, 2022 3:24 pm • Comments
The European Central Bank is reportedly preparing to implement a new law that aims to harmonize crypto regulations for all members of the European Union.
The concern stems from the fact that there could be regulatory inconsistencies and overlaps between the different central banks for the crypto industry.
As a result, this new law would ultimately create one single regulatory framework that all crypto businesses would have to follow if they want to operate in the EU.
This could be a positive thing for the industry as clear guidelines is a necessity that crypto desperately needs, but many within the crypto community are waiting to hear what the guidelines will be exactly.
Is the EU going to move forward with unified crypto regulation? https://t.co/tZUReJSiLv
— Cointelegraph (@Cointelegraph) July 5, 2022
The European Parliament, European Commission and European Council reached an agreement on June 30 to bring crypto issuers and service providers within their jurisdictional control under a single regulatory framework.
Regulators from 19 EU member states will reportedly attend a supervisory board meeting in July to discuss MiCA and its possible implementation.
Once implemented, the law will require asset service providers to adhere to certain requirements aimed at protecting investors as well as warn clients about the potential risk of investing in a volatile crypto market.
EU officials will also have an 18-month review period to assess the proposed regulatory framework and determine whether it includes other crypto-related products like nonfungible tokens (NFTs).
“It’s very challenging,” reportedly said an unnamed national regulator. “With MiCA 18 months away, are you better to say, ‘until it’s in, do what you like, there’s no regulation’ or are you better to try to get a handle on it?”
Before the passing of this new law, each country would typically have its own regulatory regulators that would be responsible for their own individual regions.
Of course, due to the complexity and the overlap, this may have been a major barrier for crypto companies to grow within the EU region and likely stifled industry growth and innovation.
With this in place, the EU may stand a chance when it comes to being a future crypto hub that attracts crypto talent from all around the world.
Still, there are still concerns about over-regulation as the ECB does not have the most positive stance on crypto despite still tolerating it.
— Oleksandr Ulytskyi (@OUlytskyi) July 4, 2022
The proposed crypto regulation will be under review for 18 months. During the period, EU officials will assess the regulatory framework and determine if the law encompasses non-fungible tokens (NFTs) and other crypto-related products.
An unnamed national regulator commented on the EU proposed regulatory framework, saying:
It’s very challenging. With MiCA 18 months away, are you better to say, ‘until it’s in, do what you like, there’s no regulation’ or are you better to try to get a handle on it?
Before implementing MiCA, individual EU member states will need to independently handle crypto regulation. For instance, the Federal Financial Supervisory Authority, or BaFin, in Germany issues licenses to crypto firms.
Perhaps only time will tell how this actually plays out for crypto in the EU.
ECB is reportedly planning to warn EU member states concerning overlapping of crypto regulations.
EU officials are already preparing to implement the MiCA framework to govern virtual assets and crypto issuers.
The European Central Bank (ECB) is workin… https://t.co/ML4wWuMJml
— Crypto-News (@criptikos) July 5, 2022
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