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EU states on Tuesday voted in favour of MiCA, the world’s first comprehensive set of rules regulating crypto assets.
On Tuesday, the Economic and Financial Affairs Council of the European Union (EU), which is made up of finance ministers of all member states, unanimously voted in favour of adopting the Markets in Crypto Asset (MiCA) regulation. Ministers from 27 member states voted to amend laws and directives relating to the highly anticipated legislation.
The EU finance minister meeting in Brussels today approved amendments that the European Parliament voted in favour of in April, and they are expected to start taking effect in phases in 2024.
The vote pressures countries like the United States and the United Kingdom to step up their industry oversight. Regulating the crypto industry has become a serious concern following the collapse of FTX and the implosion of the TerraUSD stablecoin.
According to Reuters, Elisabeth Svantesson, finance minister of Sweden, said:
Recent events have confirmed the urgent need for imposing rules which will better protect Europeans who have invested in these assets and prevent the misuse of crypto industry for the purposes of money laundering and financing of terrorism.
MiCA Could Be a Model for the US to Follow
MiCA, which has been in the works since 2022, will become the first official regulatory framework governing the crypto industry when enacted. The act will protect consumers from fraudulent activities and give clarity and transparency to the industry. The legislation will require crypto companies to comply with regulations designed to define various aspects of the sector properly. MiCA further will require crypto companies to get approval to operate in the EU and will be liable should they lose investors’ assets.
MiCA’s scope includes a range of cryptocurrencies, utility tokens, digital assets, and stablecoins and will clearly outline how cryptocurrencies and related services are to be conducted across the bloc.
The US has made very little progress in improving its oversight of the industry. Given the much-needed clarity and guidance that MiCA offers, SEC commissioner Hester Peirce believes it strikes a balance between protecting consumers while still leaving room for innovation in the sector, making it a good model for the US to follow.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.