Published on 9th June 2023, Regulation (EU) 2023/1114 establishes new rules for markets in crypto-assets (MiCA).
Published on 9th June 2023, Regulation (EU) 2023/1114 establishes new rules for markets in crypto-assets (MiCA), introducing a harmonised regulatory framework for this sector.
The main objectives of the MiCA Regulation are to improve the protection of consumers and investors in this market, to establish safeguards against financial crime and market manipulation and to reduce the high carbon footprint of crypto-assets.
In this regard, the law covers issuers of consumer tokens, asset-referenced tokens, so-called "stablecoins", service providers such as trading platforms and crypto-asset wallets.
Crypto-asset issuers and service providers are subject to various requirements regarding the supervision and authorisation of transactions, transparency and disclosure of the crypto-assets’ environmental impact.
Consequently, crypto-asset issuers must publish a white paper regarding crypto-assets they intend to issue containing general information, namely on the project to be carried out with the capital raised, on the underlying technology used and on related risks. Additionally, “stablecoins” operators must publish quarterly reports and have specific licences for the issuing of this type of cryptocurrency.
Companies that issue, trade or have custody of crypto-assets must apply for authorisation from the competent authorities in each Member State, in order to carry out their activity. They will have then to comply with specific requirements on capital, on corporate governance, on risk management policies and on security safeguards.
Furthermore, these companies are now required to implement due diligence procedures and verify the identity of their clients to ensure that cryptocurrency transactions are traceable and those involved are identified.
Service providers must adhere to specific procedures for the prevention of money laundering and terrorism financing, and must report suspicious transactions to the competent authorities.
A cooperation mechanism is also created between the regulatory authorities of the Member States, the EBA (European Banking Agency) and ESMA (European Securities Markets Authority), which includes the exchange of information and collaboration in investigation, supervision and enforcement activities.
The MiCA Regulation came into force on 29th June 2023 and will only be applicable from 30th December 2024, except for some provisions that will be implemented in June 2024.