EU is on the verge of reaching an agreement on crypto regulations
EU is on the verge of reaching an agreement on crypto regulations
Reports Authorities in the EU are getting closer to a deal on a legislative package designed to regulate the crypto market and similar activities in Europe thoroughly. According to reports in the media, an agreement on critical legislation might be achieved as soon as this month.
Sources reported, citing knowledgeable insiders, that representatives of various institutions in the European Union are nearing agreement on the Markets in Crypto Assets (MiCA) plan, which aims to implement union-wide laws for the crypto business.
They chose anonymity to explain that the French presidency of the EU Council and the European Parliament (EP) is now hopeful about addressing the concerns that have slowed the draft's progress. At two next sessions, on June 14 and June 30, negotiators should do so.
According to people acquainted with the situation, the 27-member bloc's member states and the Parliament continue to differ on key areas of MiCA. These include the regulation of stablecoins, the monitoring of crypto-asset service providers (CASPs), and the prospective inclusion of non-fungible tokens (NFTs) in the ecosystem.
Officials are currently debating how to keep the usage of stablecoins in payments to a bare minimum. There is a proposal, for example, to impose a limit on transactions that are not valued in euros. It comes after the terrausd algorithmic stablecoin's collapse last month, which impacted crypto markets. Two other key issues are ensuring investor protection and examining the effectiveness of cryptocurrencies on financial stability.
Key Crypto Regulatory Issues are Still Being Debated
The EP's Committee on Economic and Monetary Affairs (ECON) accepted MiCA in mid-March this year after it was initially submitted in 2020. Later that month, the package reached the so-called trialogue stage of the European legislative procedure, in which the final document must be coordinated by the European Parliament, the European Commission, and the European Union Council.
The need to manage the environmental effect of crypto assets is also a significant component of the discussions, and several European Lawmakers believe that the new laws should take this into consideration. The crypto community on the Old Continent reacted angrily to provisions prohibiting energy-intensive proof-of-work mining, claiming they amounted to a bitcoin ban. The text that was causing controversy was deleted from the draught. France, which now holds the EU presidency, is willing to approve the Commission's proposal to make CASP energy use public.
