European Union officials have agreed on the final language of their landmark crypto law, which might open the door for an approach to regulation that covers all of Europe. The entire legislative wording of the Markets in Crypto Assets Regulation (MiCA) was approved during a session of EU ambassadors on Wednesday, according to a letter from committee chair Edita Hrdá.In a letter to Irene Tingali, head of the European Parliament’s Economic and Monetary Affairs Committee, Hrdá argued that cooperation between the Parliament and the Council should allow the law to be approved at the Parliament’s first reading.
Legislators ultimately came to an agreement on the legislation package in June after two years of back and forth.The rule as it stands currently requires anyone intending to issue cryptocurrencies to create a “crypto-asset white paper” outlining their plan. But there will be certain financial constraints for stablecoin issuers.
As a result, projects are required to have reserves in an amount equal to the number of tokens issued to support the value of their tokens. Nevertheless, depending on how risky the initiative is thought to be, local authorities might gather the needed funds. The legislative draught will now go to the European Parliament for approval, after which it will probably be published in the early months of the following year’s Official Journal of the European Union, with the laws anticipated to go into effect in 2024.
Supporters of cryptocurrencies welcomed the announcement, but they pointed out that a number of crucial concerns, like non-fungible tokens (NFTs) and the future of decentralised finance, still needed to be addressed by the legislation (DeFi). “This represents the end of a heated but vital conversation amongst the EU co-legislators, which has been ongoing for more than two years,” the Brussels-based European Crypto Initiative (EUCI) stated in a statement.The group claimed that MPs had taken a “very defensive” position and that the legislation’s heavy focus on stablecoins came about as a result of the fact that it was developed in response to Facebook’s Diem (formerly known as Libra) initiative.
The group claimed that MPs had taken a “very defensive” position and that the legislation’s heavy focus on stablecoins came about as a result of the fact that it was developed in response to Facebook’s Diem (formerly known as Libra) initiative.According to EUCI, NFTs are not covered by the MiCA, which may cause uncertainty if authorities in different EU member states interpret the assets differently. The regulation would not also affect DeFi projects, however EUCI complained that the final wording did not sufficiently describe them.
At the moment, American efforts are stagnant.
Washington’s haphazard approach to cryptocurrencies has persisted in the interim, despite hopes by US senators to pass significant crypto legislation by year’s end being on life support. Congressman committees are delaying important votes on a number of high-profile, bipartisan projects that once seemed to have a decent chance of passing before the end of 2022. Due to MPs’ current focused focus on the elections that will take place in one month, their chances of becoming law in 2022 have all but completely evaporated.According to the calendar, Perianne Boring, founder and CEO of the Chamber of Digital Commerce trade association, it will be very challenging to carry any legislation through both chambers of Congress.
While the bulk of business sectors are okay with the Washington snarl or even actively campaign for it, the cryptocurrency industry has been vociferously promoting more regulations. They assert that Congress must act because the government organisations in charge of carrying out the current financial laws and regulations in the United States are unprepared to handle digital assets.Recent market volatility, such as the collapse of the well-known algorithmic stablecoin TerraUSD, has caused investors to lose billions of dollars and increased calls for legislative intervention on Capitol Hill. In addition to regulatory uncertainties and market failures, the price of Bitcoin, the largest cryptocurrency in the world, has decreased by more than 50% since the beginning of the year.
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