EU officials are inching closer to a deal on a legislative package to broadly regulate the crypto market and related activities in Europe. According to a media report, the key legislation is likely to be agreed by early this month.
Deal on EU crypto law expected by end of June, say sources
Bloomberg quoted informed sources as saying that representatives of relevant institutions in the European Union are approaching a consensus on a proposal to introduce union-wide regulations for the cryptocurrency industry in the crypto assets market (MiCA).
Opting to remain anonymous, he revealed that the French President of the European Union Council and the European Parliament (EP) is now optimistic about resolving the issues that are holding back the progress of the draft. The negotiators should do so in two subsequent meetings to be held on June 14 and June 30.
According to sources familiar with the matter, the 27-strong bloc’s member states and parliament still disagree on several aspects of the Mica. These include oversight of crypto asset service providers (CASPs), inclusion of non-fungible tokens (NFTs) in the framework, and regulation of stablecoins.
Officials are still discussing how to limit the use of stablecoins in payments. For example, the idea is to introduce a limit for transactions denominated in Euros. This comes after the collapse of the Terased (UST) algorithmic stablecoin last month that hit the crypto markets. Ensuring investor protection and assessing the impact of cryptocurrencies on financial stability are two other key considerations.
Key crypto regulatory aspects continue to be discussed
MiCA, which was first introduced 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 triad phase of Europe’s legislative process later that month, during which the final draft must be coordinated between the European Parliament, the European Commission and the Council of the European Union.
A key element in the talks is also the need to address the environmental impact of crypto assets and some European lawmakers say the new law should take this into account. The provisions banning energy-intensive proof-of-work mining sparked reactions from the crypto community of the Old Continent, which complained that they amounted to a bitcoin ban. Controversial texts were omitted from the draft. France, which currently presides over the European Union, is set to accept a proposal by the Commission to disclose the energy consumption of CASPs.
EU members and union legislatures are also debating whether to include anti-money laundering provisions in crypto law. National governments are pushing for a different set of rules while European lawmakers have proposed the establishment of a list of non-compliant CASPs.
Do you expect the EU to agree on the markets in the Crypto Assets Draft by the end of June? Tell us in the comments section below.
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