EU advances plan for strict crypto regulations

Significance

EU institutions and members must now agree on the final version and its technical provisions. On September 21, a leaked version of the text introducing MiCA raised concerns in the cryptocurrency industry over the regulation’s scope which could include digital assets such as non-fungible tokens (NFTs).

Impacts

• Legal issues could arise because the coexistence of MiCA with existing financial legislation increases the complexity of the EU laws.
• MiCA will regulate the issuance and trading of NFTs and algorithmic stablecoins that may be used as speculative instruments.
• MiCA will prevent insider trading and market manipulation but it does not target crypto crime.