The members of the European Union Council approved the Markets in Crypto Assets Regulation (MiCA) framework, taking a significant step toward creating rules for how digital asset exchanges and other service providers should operate in EU member states.
MiCA outlines rules for companies that provide services related to digital assets, such as identification verification and minimum standards for stablecoin reserves.
Stablecoin limits have more recently come under the spotlight for authorities in the wake of Terra’s collapse. Last month there were reports of the EU planning to ban stablecoins under the MiCA legislation and Blockchain for Europe and the Digital Euro Association wrote to the EU Council in an effort to reverse such rules.
Also Read: EU Agrees on MiCA Regulation for Crypto Assets & Stablecoin
Before the proposal is formally adopted, the European Parliament will vote on it on October 10. If approved, the framework would ideally go into effect at the beginning of 2024.
Regulators in the EU are anticipating the upcoming International Monetary Fund (IMF) and World Bank annual meeting to discuss regulation with the U.S. since they believe a worldwide effort will be required to properly develop a credible framework.
Meanwhile last month, the White House published the first-ever crypto framework focused on strengthening regulatory oversight of the digital asset market after studying the industry for about six months.
Mairead McGuinness, the EU commissioner for financial services, noted, “We have a crowded agenda for the US next week, and one of the items that won’t be at the bottom of the list, it will be in there right around the top is crypto.”
