Today European Union Parliament voted in favor of a new crypto licensing regime, Market in Crypto-assets Regulation (MiCA), making it the first major jurisdiction in the world to introduce a comprehensive crypto law.
The lawmakers also voted in favor of a separate law known as the Transfer of Funds regulation, which will require all crypto-asset service providers recognized under MiCA to identify their customers and include information about the sender and beneficiary with crypto-asset transfers.
The provisional EU Market in MiCA was agreed on between the European Commission, the European Parliament, and the Council of the European Union back in June 2022, and in the end of 2022, the Council had already approved the MiCA text. So this was a formal approval by the European Parliament with its text reviewed by a team of “lawyer-linguists” and translated into each of the official languages of the EU.
In his opening remarks at the European Parliament plenary debate the Commissioner McGuinness stressed the importance of the law:
And as we have seen in recent months, stringent rules and supervision are very much needed. Because we've had the collapse of projects such as FTX, Terra Luna, Celsius and Voyager. We've seen many retail investors, lured in by false promises or false hopes, losing huge amounts of money. And while the crypto market may be too small to trigger systemic risks, we do know there are increasing links between crypto markets and traditional financial services.
He also thanked rapporteurs Stefan Berger for MiCA, Ernest Urtasun and Assita Kanko for the Transfer of Funds Regulation for their work on the law.
The MiCA provisions on stablecoins will start to apply in July 2024, while the provisions on issuers of other crypto-assets and crypto-asset service providers will start applying in January 2025, together with the Transfer of Funds rules.
As Ernest Urtasun put it, the European Parliament had just put an end to the Wild West era for the unregulated world of crypto. Let's Observe if crypto enters the Golden Age too.
