The European Union has approved the initial set of regulations across the world that aims to comprehensively govern the use of cryptocurrency.
Markets in Crypto-assets (MiCA) regulation, anticipated to be implemented in the upcoming year, imposes a series of regulations on companies that deal in digital currencies. These regulations mandate licensing for organisations involved in issuing, trading, or storing crypto assets within the 27-nation block.
In addition to addressing licensing concerns, the EU Council has adopted measures to combat money laundering through cryptocurrencies. These measures involve expanding regulations to include crypto assets and requiring specific information to accompany fund transfers.
No more crypto anonymity
Swedish Finance Minister Elisabeth Svantesson said, “Today’s decision is bad news for those who have misused crypto-assets for their illegal activities, to circumvent EU sanctions or to finance terrorism and war. Doing so will no longer be possible in Europe without exposure – it is an important step forward in the fight against money laundering.”
This aspect of the new regulations is scheduled to be implemented in 2026.
Under the new regulations, all organisations engaged in cryptocurrency purchase or trading would be obligated to gather and provide specific information about the sender and recipient of crypto asset transfers, irrespective of the transaction size. In essence, this means bidding farewell to the alleged anonymity of cryptocurrencies.
The EU Council approved MiCA as part of a comprehensive digital finance regulation package, along with the Digital Operational Resilience Act aimed at enhancing IT systems in financial institutions, as well as a proposal for a distributed ledger technology trial in wholesale applications.
You can read the 525-page treaty ‘Regulation on markets in crypto-assets (MiCA)’ here.