The European Union (EU) has taken a significant step towards establishing a standardized regulatory infrastructure for cryptocurrencies with the adoption of the Markets in Crypto-Assets Act (MiCA).
This Act will work towards eradicating uncertainties for investors and institutions by setting a standard set of regulations for cryptocurrency assets across the EU. The legislation, however, still needs approval from the European Council before it can become standard regulation.
Following the vote, Stefan Verger, a member of the European Parliament, tweeted that the adoption of the regulation was a significant milestone for the crypto asset industry. He thanked his colleagues and the community for their support.
The Crypto-assets Act will create guidelines for regulators and policymakers, establishing a framework for the industry and creating policies for the issuance and operation of digital assets.
This framework will simplify the authorization process for service providers operating in the EU single market. With MiCA, market participants will no longer have to navigate 27 sets of different national rules.
Chainalysis reports that some of the regulations that will be part of the Act, such as those pertaining to stablecoins, will likely come into effect in 2024, while others will come into effect at the beginning of 2025.
The Act will continue to have national competent authorities supervise CASPs while giving the European Securities and Markets Authority new responsibility for significant CASPs, such as those serving a daily average of more than 15 million active users in a year.