The European Parliament approved in plenary session the first rules for the crypto sector and the transfers in digital assets. MiCA should enter in application in 2024.
MEPs voted this Thursday, April 20, approving with 529 votes for and 29 against the establishment of a new regulatory and common framework on cryptocurrencies. The vote in plenary session covers both MiCA and on the TFR (on transfer arrangements).
Previously adopted by the European Council last fall, MiCA aims, in addition to TFR, to strengthen investor protection, prevent money laundering and trace transactions in the same way as traditional money transfers.
Self-custody wallets not affected
In a press release, the Parliament underlines that the law will cover transactions of more than 1,000 euros made from self-hosted wallets, i.e. in self-custody. A subtlety, however, but a big one.
This regulation only applies when wallets interact with hosted wallets managed by crypto service providers. Direct transfers between individuals or between providers acting on their own behalf are not subject to the new rules.
As far as MiCA is concerned, the Digital Assets Regulation is the first framework of its kind. It aims to set a common and binding legal frameworkwith obligations, for financial assets and services that have been little or not regulated until now.
A public register of unscrupulous providers
Issuers and trading platforms thus inherit new responsibilities. For the Parliament, these include transparency, disclosure, authorization and monitoring of transactions.
MiCA must also ensure that consumers are better informed about the risks, costs and fees associated with their transactions.
In addition, the new legal framework will support market integrity and financial stability by regulating public offerings of crypto-assets.”
The globalization of finance, whether traditional or cryptoHowever, there are some concerns, in particular the fear of unfair competition from offshore-based players exempt from European legislation.
The EU is partially responding to this risk by entrusting the European Securities and Markets Authority with the establishment of a public register of non-compliant crypto-asset service providers operating in the European Union without authorization.
Environmental impact: a measure, but no obligations
In terms of environmentalThe European legislator has chosen not to impose constraints on the crypto industry, an issue on which the industry is regularly criticized.
To reduce the high carbon footprint of crypto-currencies, major service providers will have to disclose their energy consumption,” the Parliament says.
MiCA’s rapporteur, MEP Stefan Berger however, is keen to welcome this regulatory achievement. “This puts the EU at the forefront of the token economy and its 10,000 different crypto-assets.” He also believes that the ecological issue is not neglected.
We have made sure that environmental impact disclosure will be taken into account by crypto asset investors.”
MiCA, asset or liability for the European crypto industry?
Stefan Berger also sees MiCA as a competitive advantage for Europe.
He claims, “The European crypto-asset industry enjoys a regulatory clarity that does not exist in countries like the United States.
Co-rapporteur on transfers, Ernest Urtasun sees the TFR overhaul as a way to Stop the “criminal flow of crypto-currencies.” And to restore fairness to AML compliance.
To companies arguing a risk to competitiveness, Co-Rapporteur Assita Kanko replies:
Any administrative burden on crypto-currency companies and innovators will be more than offset by the fact that we are unifying the currently fragmented European market, which has 27 regulatory regimes.”
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