Markets in Crypto Assets (MiCA), the European Union’s comprehensive regulation for crypto companies, will come into force by the end of the year. However, nearly a quarter of the bloc’s 27 countries are not prepared for this regulation.
Legislation Compliance Process
In order for MiCA to be applied to countries, EU member states must harmonize their local laws with the regulation. According to a document prepared by the Electronic Money Union, countries that have not yet complied include Belgium, Italy, Poland, Portugal, Luxembourg and Romania. Trade associations representing the crypto industry say the European Commission and the European Securities and Markets Authority (ESMA) underestimated this lack of preparation.
What is more valuable than technical analysis for cryptocurrency investors is monitoring such news feeds regularly. Regulatory policies and ongoing processes regarding cryptocurrencies are extremely important for long-term performance.
Challenges in the Implementation Process
Implementation of MiCA consists of two stages. The first phase required stablecoin issuers to obtain the necessary authorization in June. The second phase includes the end of December and requires crypto asset service providers such as exchanges and wallet providers to be registered and licensed within the EU.
“The integration of MiCA into national laws is not progressing as expected,” said Robert Kopitsch from Blockchain for Europe. This delay may lead some companies to cease operations in Europe.
“If you do not have the license, you must stop your services in Europe.” -Robert Kopitsch, Blockchain for Europe
Some countries cannot receive a response because the legal legislation process takes a long time. In Germany, existing regulations need to be revised to meet MiCA requirements. Although this process is almost completed in countries such as Poland and Portugal, time is still running out.
ESMA rejected the six-month “inaction” request requested by the union countries, but will re-evaluate the issue at the meeting to be held in December. There is the possibility of providing guidance during this process.
Failure to fully implement MiCA could lead to competitive imbalances within the EU and undermine users’ confidence. Countries that are not prepared may limit the activities of crypto firms, causing economic losses.
For the successful implementation of MiCA, EU countries need to quickly harmonize their local laws and regulatory bodies need to manage the processes effectively. This is vital for the sustainable growth of the crypto market and the protection of users.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
