The European Parliament has approved a rule set under the Markets in Cryptoassets (MiCA) regulation that aims to create a harmonised regime governing supervision, consumer protection and environmental safeguards for cryptoassets.
Members of the European Parliament voted in favour of the regulation by 517 votes to 38, with 18 abstentions.
The draft law was agreed informally in June 2022 with the European Council and includes provisions relating to market manipulation and financial crime, terrorist financing and other criminal activities.
MiCA is applicable to cryptoassets that are not regulated under current financial services legislation and contains provisions relating to issuance and trading in cryptoassets. The new legal framework aims to promote market integrity and financial stability, while improving consumer protection by raising investor understanding of the risks, costs and charges associated with transactions in this asset class.
The MiCA texts will now pass before the European Council for endorsement, prior to being published in the EU Official Journal and coming into force 20 days later.
German MEP Stefan Berger, lead MEP for the MiCA regulation, says: “This puts the EU at the forefront of the token economy with 10,000 different cryptoassets. Consumers will be protected against deception and fraud, and the sector that was damaged by the FTX collapse can regain trust. Consumers will have all the information they need and all underlying risks around cryptoassets will have to be monitored.
“We secured that the environmental impact disclosure will be taken into account by investors in cryptoassets. This regulation brings a competitive advantage for the EU. The European cryptoasset industry has regulatory clarity that does not exist in countries like the US.”
Assita Kanko, Belgian MEP and co-rapporteur for the Civil Liberties, Justice and Home Affairs Committee, says: “Parliament and Council have found a fair compromise that will make it safer for people of good will to hold and trade cryptoassets. However, it will make it more difficult for criminals, terrorists and sanctions evaders to misuse cryptoassets.
“Any administrative burden on crypto companies and innovators will be more than offset by the fact that we are unifying the currently fragmented European market that has 27 regulatory regimes.”
