EU financial regulators are set to finalize the implementation of the Crypto Markets Regulation (MiCA). Faced with this near horizon, the European Securities and Markets Authority (ESMA) urges regulators to mobilize for this new phase.
ESMA calls for a smooth transition to MiCA
Crypto, once uncharted territory, is preparing to enter a regulated era in Europe with the establishment of MiCA. ESMA, guardian of financial markets in Europe, ensures impeccable implementation.
In letter dated October 17 addressed to ECOFIN, it emphasizes the urgency for Member States to quickly designate the appropriate authorities to fulfill the roles specified by MiCA.
MiCA grants a transition period, authorizing existing players in the crypto market to maintain their services until July 1, 2026. However, it is essential to anticipate and prepare well.
In its recent publication, ESMA emphasizes the need for States to determine the responsible authorities for the application of MiCA. Such an approach is essential to ensure a smooth transition.
Said authorities are invited to coordinate their monitoring efforts and methods with their European peers, thus ensuring effective supervision from the start. Verena Ross, President of ESMA, also recommends limiting grandfathering periods to 12 months, to encourage rapid adoption of MiCA.
ESMA facing the challenges of crypto regulation in Europe
ESMA firmly intends to combat inappropriate practices compromising market integrity. It aims in particular to counter entities which register for a simple formal presence in the EU, while depending mainly on clients and partners outside Europe.
The issue of regulatory arbitrage, where companies select a specific country for its license, is a central concern. ESMA calls for consistent implementation of the new supervisory directives across the EU.
With the introduction of MiCA, priority is given to consumer protection, the integrity of the crypto market and transparency on environmental impact.
Europe is at a crossroads when it comes to crypto regulation. Faced with the imminent introduction of MiCA, ESMA is working to ensure a smooth transition and establish robust foundations for the future of the European crypto sector.
As the deadline for implementing these new regulations approaches, all eyes are turning to the EU, hoping that this framework does not hinder innovation.
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