The Markets in Crypto-Assets (MiCA) regulation is approved by a unanimous vote of the European Union’s finance ministers.
Following a vote on May 16, the Economic and Financial Affairs Council of the European Union, which is made up of the finance ministers of all member states, approved the long-anticipated Markets in Crypto-Assets law.
The MiCA bill and amendments of numerous laws and directives relevant to the new legislation were approved by the finance ministers of 27 member states.
Along with the adoption of MiCA, the European Parliament also approved two other pieces of legislation, including rules governing the disclosure of information on financial transfers and specific crypto assets.
On April 20, the MiCA Act was formally accepted by the European Parliament, clearing the way for the European Council to give it its final approval before the regulatory standards go into effect.
The Act establishes precise regulatory standards and obligations for the use of cryptocurrencies and related products and services within the European Union. A variety of cryptocurrencies, digital assets, utility tokens, and stablecoins are included in the law’s coverage.
The measure must be published in the Official Journal of the European Union as the next stage in the lengthy process for MiCA to become EU law. MiCA will take effect in a year, making the regulations officially enacted by the middle of 2024.
MiCA was initially suggested by the European Commission in September 2020, but it has encountered many roadblocks and delays as it moves through the legislative process.
Given that it provides a uniform market environment across Europe in terms of legal requirements and operational processes, the legislation has generally been welcomed by cryptocurrency service providers and supporters alike.
The registration and authorisation requirements for cryptocurrency issuers, exchanges, and wallet providers are important elements of MiCA legislation.
While cryptocurrency custody services must offer adequate security and safety measures to address any cybersecurity and operational failures, stablecoin issuers must adhere to certain security and risk mitigation criteria.
The legislation also offers a framework to stop insider trading, market manipulation, and other illegal activities in the crypto sector.