EU regulator to amend MiCA rules
EU regulator to amend MiCA rules
The European Securities and Markets Authority (ESMA), has called on the European Commission to amend the Markets in Crypto-Assets Regulation (MiCA) to better address emerging industry needs and regulatory gaps. While the MiCA framework marked a major step in EU-wide crypto regulation, ESMA emphasized that modifications are necessary to meet the framework’s initial objectives more fully.
In its latest report, ESMA recommended adjusting the regulatory technical standards (RTS) around disclosures and the authorization process for crypto asset service providers. The RTS amendments would address transparency issues related to firms’ intentions to offer crypto services, intending to build stronger safeguards for investors. This push for change follows concerns within the Commission about the legal limitations within the MiCA framework, which some policymakers argue could hinder its effectiveness.
Introduced in 2023, MiCA was the first comprehensive regulatory attempt within the EU to govern the rapidly evolving crypto landscape, which includes decentralized finance (DeFi), stablecoins, and various crypto asset services. Yet, as the regulatory environment matures, ESMA's recommendations indicate an urgency to align MiCA’s technicalities with the EU’s broader financial stability and transparency goals.
The proposed amendments are now up for consideration by EU policymakers. With MiCA already influencing crypto regulation models globally, any modifications could set new standards in digital asset oversight. The crypto community and stakeholders in financial markets will be watching closely, as these changes could redefine the operational landscape for digital asset providers and enhance investor protections.
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