Financial Services chief urges World
Mairead McGuinness, the head of European Union (EU) financial services, has urged the rest of the world to follow the EU’s new comprehensive rules for crypto-assets, Reuters reports.
The EU’s Markets in Cryptoassets Regulation (MiCA) will be the world’s first set of rules for the previously unregulated cryptocurrency sector after it was approved on Thursday, April 20.
Preventing Another FTX-Like Crypto Scandal
The crypto industry has been rocked by the failure of crypto exchange FTX and other setbacks, causing the benchmark bitcoin prices to plummet.
The EU’s MiCA regulation requires that crypto firms be allowed to serve customers in the bloc through the EU and adhere to anti-money laundering and anti-terrorist financing safeguards.
Reuters tells us that MICA will be phased in beginning in July 2024 to align with the sector’s timing. Crypto firms licensed in one EU member state can offer their services in all 27 countries.
Additionally, the regulation identifies and covers three types of crypto-assets: asset-related tokens (ART), electronic money tokens (EMT), and other crypto-assets not protected by current EU law.
European lawmakers are describing the new regulations as the end of the “Wild West era” of cryptoassets — an apt metaphor for the state of cryptoasset security over the past few years.
Cities across the EU, including Paris, are already offering firms in the sector. However, McGuinness stresses that other countries should follow suit by creating strong and robust crypto regulations, as global harmonization is vital.
More Countries Heeding the Call
No equivalent laws exist in the UK, although UK lawmakers have recently published draft regulations for crypto-assets.
The UK Financial Conduct Authority (FCA) currently oversees crypto-asset firms to ensure they have adequate anti-money laundering (AML) and terrorist financing procedures in place, but the crypto-assets themselves Not regulated.