The European Securities and Markets Authority (ESMA), the financial watchdog of the European Union (EU), has announced its plans to launch a three-part consultation process for the recently adopted Markets in Crypto-Assets (MiCA) framework. This move is a significant development in establishing comprehensive regulations for the rapidly growing crypto market.
The consultations, set to begin in July 2023, will cover various crucial aspects of MiCA, ensuring a smooth and effective implementation of regulations and fostering a regulated environment for cryptocurrencies within the EU.
In a notice posted on the ESMA website on June 12, regulators outlined the consultation packages subject to the European Commission, European Parliament, and European Council approval. The first package will focus on technical standards for crypto asset service providers in the EU and procedures for handling complaints and disclosing potential conflicts of interest.
The second package, expected to launch in October, will address information disclosure to investors, governance requirements for crypto firms, and the consideration of sustainability indicators and adverse impacts on the climate.
ESMA plans to release the final consultation package in the first quarter of 2024, which will likely address investor protection and rules to counter market abuse. The MiCA framework proposed an approximate timeline of 18 months for full implementation, with all rules scheduled to come into effect in December 2024.
Adopting the MiCA framework by the Council of Economic and Financial Affairs of the European Union in May 2023 marked a significant milestone. The legislation gained approval from the finance ministers of all 27 member states and amendments to several regulations and directives related to the new framework. Additionally, the European Parliament adopted two other legislative pieces in conjunction with MiCA, including regulations on information accompanying transfers of funds and certain crypto assets.
Implementing the MiCA framework in Europe makes for a significant step towards comprehensive crypto regulations. Designed to establish Europe as a global leader in tailored regulations, MiCA covers various aspects of the crypto ecosystem, offering clarity and compliance standards. It aims to create a steady regulatory framework across EU member states and serve as a blueprint for other nations.
With a focus on investor protection and market integrity, MiCA is poised to shape the future of digital asset regulations and foster the growth of the crypto market in the EU.
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash