MiCA Law: EU’s New Regulation for Crypto-assets
MiCA Law Immortalized in EU Magazine
The MiCA (Markets in Crypto-Assets) legislation officially became a law when the government of the European Union signed it on June. The EU has an official magazine where legal developments in Europe are published, which also features the latest edition of the law. The 252-page magazine has versions available in all EU languages, including Dutch.
Overview of MiCA Law
The EU has focused on three topics, including the ban on materials and products associated with deforestation. The other two are related to crypto-assets. According to the government, it is essential to monitor cryptocurrency transactions adequately and have users of blockchain record transactions to the government. Crypto-assets can pose a potential threat to the reliability, stability, and reputation of Europe’s financial industry. Criminals can exploit the possibilities offered by cryptocurrencies, thereby necessitating counter-terrorism and anti-money laundering measures.
Stablecoins under Asset-Related Tokens
Stablecoins have been classified under ‘asset-related tokens’ by the EU. Shares on blockchain are also included in this category, and all these tokens are required to cover the underlying value. Stablecoins’ underlying value ensures that digital assets have a stable price and can be used more as a means of exchange. This feature attracts crypto traders worldwide and adds reliability to the digital assets’ market.
Importance of Crypto Monitoring
The EU has taken an essential step in creating standardization and regulation for cryptocurrencies compared to other countries like the United States, where clarity on crypto regulation is not yet present. Coinbase has sued the US Securities and Exchange Commission (SEC) due to unclear regulations. According to Coinbase, the SEC has refused to provide clarity.
- Advertisement -
The MiCA law has brought reliability to the crypto industry and has reinforced the EU’s dedication to keep pace with technological advancements. The stablecoin classification under ‘asset-related tokens’ is excellent news for crypto traders worldwide and cements digital assets’ future as a payment method. These regulations will bolster the integrity of the digital asset market and protect investors’ interests.