During a recent event at the Vivatech technology conference in Paris, the Governor of the Bank of France, Francois Villeroy de Galhau, emphasized the necessity of international cooperation in order to effectively regulate crypto conglomerates.
As reported by Bloomberg, Villeroy pointed out that regulating a single legal entity within a single jurisdiction is insufficient. To illustrate his point, he highlighted the case of the United States crypto companies that operate through multiple legal entities in different jurisdictions. According to Villeroy, this situation underscores the importance of international collaboration in addressing regulatory challenges in the crypto industry.
In highlighting the European Union’s leadership in crypto regulation, the central bank executive implied the need for an updated version of the Market in Crypto Assets (MiCA) legislation. He referred to this potential version as “MiCA 2,” indicating the necessity of adopting regulations to effectively address the challenges posed by the crypto conglomerates.
In April, European lawmakers successfully passed the Markets in Cryptoassets (MiCA) legislation, marking a significant milestone in the EU’s efforts to establish comprehensive rules for the crypto industry.
This groundbreaking regulation represents the first coordinated attempt by governments to oversee the emerging crypto sector on a large scale. Its development was prompted by the collapse of several major players in the industry, including the notable FTX crypto exchange.
While MiCA sets out to provide a regulatory framework, it does not encompass certain areas such as crypto lending, decentralized finance, and non-fungible tokens (NFTs). This has prompted discussions about the potential need for a MiCA 2, as pointed out by notable figures like Christine Lagarde, the Chief of the European Central Bank.
Governor Villeroy stressed the importance of regulating actors who utilize decentralized finance technology for financial services, emphasizing that the same risks and activities should be subjected to the same rules. This highlights the need for continued regulatory efforts to address the evolving landscape of the crypto industry.