EU agrees on landmark regulation to clean up crypto 'Wild West'
EU officials on Thursday secured an agreement on what is likely to be the first major regulatory framework for the cryptocurrency industry.
The European Commission, EU lawmakers and member states hammered out a deal in Brussels after hours of negotiations. The move came a day after the three main EU institutions finalized measures aimed at stamping out money laundering in crypto.
The new rules agreed Thursday come at a brutal time for digital assets, with bitcoin facing its worst quarter in more than a decade.
Known as Markets in Crypto-Assets, or MiCA, the landmark legislation will make life tougher for numerous players in the crypto market, including exchanges and issuers of so-called stablecoins, tokens that are meant to be pegged to existing assets like the U.S. dollar.
Stablecoins like tether and Circle's USDC will be required to maintain ample reserves to meet redemption requests in the event of mass withdrawals. They also face being limited to 200 million euros in transactions per day if they become too big.
While EU member states will be the main enforcers of the rules, the European Securities and Markets Authority, or ESMA, is also being given powers to step in to ban or restrict crypto platforms if they threaten investor protection, market integrity or financial stability.
«Today, we put order in the Wild West of crypto assets and set clear rules for a harmonised market that will provide legal certainty for crypto asset issuers, guarantee equal rights for service providers and ensure high standards for consumers and investors,» said Stefan Berger, the lawmaker who led negotiations on behalf of the European Parliament.
MiCA will also address environmental concerns surrounding crypto, with firms required to
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