EU authorities are nearing an agreement on a bespoke legislative package to fully regulate the cryptocurrency market and related activities in Europe. According to a media report, agreement on key legislation is likely to be reached as early as this month.
Agreement on EU cryptocurrency law expected by the end of June, sources say
Representatives of relevant institutions in the European Union are approaching consensus on cryptocurrency markets (Not) proposal that aims to introduce union-wide rules for the cryptocurrency industry, Bloomberg reported, citing well-informed sources.
Choosing to remain anonymous, they revealed that the French Presidency of the Council of the EU and the European Parliament (EP) are now optimistic about resolving the issues that are holding back the advance of the draft. Negotiators are expected to do so in two upcoming meetings, June 14 and June 30.
The 27-member bloc member states and Parliament still disagree on several aspects of the MiCA, according to sources familiar with the matter. These include the oversight of cryptocurrency service providers (CASPs), the potential inclusion of non-fungible tokens (NFTs) in the framework, and the regulation of stablecoins.
Officials are still debating how to limit the use of stablecoins in payments. For example, there is the idea of introducing a cap for transactions that are not denominated in euros. It comes after last month’s collapse of the terrausd algorithmic stablecoin (UST) that hit the cryptocurrency markets. Ensuring investor protection and measuring the impact of cryptocurrencies on financial stability are two other important considerations.
Discussions on key aspects of cryptocurrency regulation continue
The MiCA, first presented in 2020, was approved by the EP’s Committee on Economic and Monetary Affairs (ECON) in mid-March this year. The package entered the so-called trilogue phase of the European legislative process at the end of the month, during which the final draft has to be coordinated between the European Parliament, the European Commission and the Council of the European Union.
A key element in the negotiations is also the need to address the environmental impact of cryptocurrencies, and some European lawmakers insist that the new legislation should take this into account. Provisions banning energy-intensive proof-of-work mining have sparked reactions from the crypto community of the Old Continent who complained that it amounted to a ban on bitcoin. Controversial texts were removed from the draft. France, which currently holds the EU presidency, is ready to accept a Commission proposal to disclose the energy consumption of CASPs.
EU members and the union legislature are also discussing the inclusion of anti-money laundering provisions in cryptocurrency legislation. National governments are pushing for a separate set of rules while European lawmakers propose creating a list of non-compliant CASPs.
Do you expect the EU to agree on the Markets in Crypto Assets draft by the end of June? Tell us in the comments section below.
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