As the European Union celebrates the official enactment of its comprehensive Markets in Crypto-Assets regulations, a recently commissioned study by the EU Parliament proposes a compelling notion—treating crypto assets as securities by default.
This proposition, echoing the stance of U.S. Securities and Exchange Commission Chair Gary Gensler, holds the potential to provide further validation to regulatory efforts on both sides of the Atlantic.
The Next Step after MiCA
The MiCA regulation was ceremoniously signed this Wednesday by the esteemed Roberta Metsola and Peter Kullgren, who is Swedish Rural Affairs Minister,
This momentous step seeks to usher in a new era of clarity and oversight for the dynamic crypto industry.
Accompanying the MiCA regulation is a separate law targeting money laundering, mandating crypto providers to diligently verify customer identities during fund transfers.
Anticipated to take effect in the upcoming weeks, MiCA will pave the way for wallet providers and crypto exchanges to obtain licenses and operate within the European Union.
Furthermore, issuers of stablecoins will be held accountable to maintain appropriate reserves, ensuring stability and safeguarding the interests of users and investors alike.
As the dust settles on the recent enactment of MiCA, the spotlight swiftly turns toward the next chapter of crypto regulation.
This pivotal phase holds the promise of delving into crucial subjects like staking, non-fungible tokens, and the intriguing realm of decentralized finance.
While the provisions laid out in MiCA have garnered widespread appreciation from industry players, ongoing deliberations continue to shape future regulations aimed at embracing and governing the ever-evolving landscape of emerging trends and groundbreaking technologies.
These discussions reflect a collective effort to ensure that the regulatory framework remains adaptive and responsive to the dynamic nature of the crypto sphere.
What do the Studies Say?
In a report commissioned by the EU Parliament, a study conducted in April proposed a thought-provoking idea: considering crypto assets as transferable securities as a default classification.
This means that unless a crypto intermediary can obtain an exemption from a national competent authority, the asset would be categorized as a transferable security.
However, there is still room for other classifications, such as financial derivatives or payment services, if the appropriate exemption is granted.
The researchers behind the study highlighted two significant factors that drove the recommendation. Firstly, the rapid pace of innovation in the crypto industry necessitates a clear and standardized approach to regulation.
Secondly, the elusive nature of crypto regulation, akin to a game requires a rule that can effectively address the challenges of staying on top of this ever-evolving landscape.
By implementing this proposed rule, the aim is to foster greater transparency and consistency in the regulatory framework governing crypto assets.
Furthermore, the study puts forth an intriguing proposition: transferring the responsibility and expense of regulatory compliance from national regulators to crypto asset providers or those facilitating their trading.
This shift in burden aims to ensure that those directly involved in the crypto ecosystem bear the responsibility to follow regulatory requirements. By doing so, the study suggests a more efficient and practical approach to managing the regulatory framework surrounding crypto assets.
Does the Study Vindicate the SEC’s Stance?
In a recent development, the SEC’s Commissioner Hester Peirce highlighted the potential for the European Union’s implementation of the MiCA regulation to serve as a valuable learning experience for the United States.
Interestingly, the study provides an intriguing perspective that could be perceived as vindication for SEC Chair Gary Gensler and his stance on crypto assets.
Gensler has consistently emphasized that a majority of crypto tokens should be classified as securities. However, his firm stance has attracted criticism from the industry, particularly due to the SEC’s enforcement actions against various crypto companies.