The MiCA Law Roadmap: Everything You Need to Know – BeinCrypto

In the document presented, it is stated: “In parallel with the surge in capitalizations and the issuance of new types of tokens, there is a proportional growth in trading volumes, supported by the emergence of platforms specialized in the trading in crypto-assets whose size and volumes now rival some of the smaller established markets.”

Europe worries about the intrinsic value of crypto-assets

ESMA pointed out that many crypto assets have no real or tangible value, unlike traditional securities like stocks or bonds, which give investors rights to future cash flows or claims on the assets of the cryptocurrency. company in the event of liquidation.

“Due to their volatile growth cycles, and until relevant regulatory provisions apply, crypto-assets carry many risks that could, in the future, impact financial stability,” noted ESMA.

The document is published in a context where the pound and the euro are experiencing a collapse on the international market. Similarly, Messari recently noted in his research that citizens of the United Kingdom and the European Union sold their pounds and euros to obtain BTC when the value of their national currencies fell.

The European Securities and Markets Authority is also concerned about how some aggressive marketing initiatives aimed at the public, especially less experienced retail investors, could increase speculative activity in the market.

The document also states: “The pseudonymity that reigns in the crypto-asset markets makes it virtually impossible to assess the solvency or overall exposures of participants.”

The final version of the law is not expected for more than two years

The document also highlights an investigation by European supervisory authorities, which revealed that around 90 European-based investment funds have direct exposure to cryptocurrencies, in addition to 20 funds with indirect exposure. .

Moreover, to combat risks, mention is made in the document of the risk monitoring framework established by ESMA for the crypto asset market. The latter covers five points, namely liquidity, market, credit, contagion and exploitation, to analyze unbacked crypto-assets, backed stablecoins, digital asset service providers and decentralized finance (Challenge).

In parallel, ESMA has also sought assistance from international standard-setting bodies such as the Financial Stability Board (FSB) and the International Organization of Securities Commissions (IOSCO), given the global nature of the crypto market. .

It is expected that the final version of the MiCA law, which aims to establish a comprehensive regulatory framework for crypto-assets, will be published in the Official Gazette in the spring of 2023 and will come into force between 12 and 18 months later.

The German blockchain association had also informed the community that the MiCA law will be fully applicable in 2024.

The updated draft law, which was leaked on September 20, will have to be approved by the European Council and the European Parliament before taking effect.


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The MiCA Law Roadmap: Everything You Need to Know – BeinCrypto

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