Asset Regulation Bill, (MICA) is Put to Law by the EU

• The European Council, Commission, and Parliament have finally come to an agreement for MICA’s implementation. 
• Europe’s top securities regulator has warned that soaring inflation may drive retail investors into risky crypto assets.

The European Union has issued a warning on the risks of cryptocurrencies, saying that they pose a threat to financial stability. The EU’s financial services chief, Mairead McGuinness, said that any crypto regulations imposed on the market would need to be coordinated with other countries around the world.

The European Securities and Markets Authority (ESMA) also warned investors about the risks of cryptocurrencies, saying that they are “highly risky” and could lead to financial instability. The ESMA urged for increased monitoring and regulatory oversight of the crypto market to prevent fraud.

The EU is the first continent to come to an agreement on crypto regulation, with the Markets in Crypto Assets Regulation (MiCA) passing the European Parliament on October 18, 2022. MiCA will establish a standard licensing system across all EU member states by 2024 and help regulate out-of-scope crypto markets, assets, and service providers.

The US Securities and Exchange Commission (SEC) has been more cautious about regulating cryptocurrencies, with some commissioners arguing that the agency does not have the authority to regulate them. However, the SEC has taken some enforcement actions against crypto companies, and it is likely that the agency will continue to play a role in regulating the crypto market in the future.

The lack of clear regulation around cryptocurrencies has created a Wild West environment where fraudsters can easily operate. It is important for regulators around the world to work together to create a regulatory framework that protects investors and prevents fraud.