EU Agrees on Final Crypto and Stablecoin Regulation

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On 30 June 2022 the EU reached a provisional agreement on the final regulatory framework for crypto assets in its draft Markets in Crypto Assets Regulation (MiCA). We previously reported on what the MiCA Regulation is and how it will impact crypto here.

Some highlights include: 

  • MiCA covers e-money tokens, stablecoins, and utility tokens 
  • MiCA won’t apply to regular securities, CBDCs, or NFTs and ‘media-related digital property’
  • New crypto projects will have to publish detailed whitepapers, while current and new stablecoins will additionally require to be well-capitalized and won’t be able to pay interest
  • Crypto firms will be required to publish energy usage information 
  • It is likely to be 2024 before MiCA will come into effect 

Further details are in our previous article referenced above. 

Richard Garnder, CEO of Modulus stated: 

Not everything contained in it [MiCA] is going to appeal to all the players, but, at this point, the industry just needs to understand what’s expected of it. It is well past time for a guidebook so that operators can act with intention.

MiCA isn’t a standalone initiative and is part of the European Commission’s digital finance strategy which includes the DLT Pilot Regime and the Digital Operational Resilience Act (DORA), which we’ve previously reported on.

EU Crypto AML Travel Rules Includes Unhosted Wallets!

On 29 June 2022 the EU agreed on changes to its AML laws for crypto assets. We previously reported on the EU’s crypto AML proposals in the Transfer of Funds Regulation here and here.

Of interest for exchanges and other crypto providers, the final rules include the onerous requirement to monitor transfers of crypto-assets a value of EUR 1,000 or more between crypto-asset service providers and ‘un-hosted wallets’ i.e. regular ‘cold’ wallets that are controlled by their owners rather than by the exchange.  See more details here.

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