Markets in Crypto Assets Regulation (MiCA)
Markets in Crypto Assets (MiCA) regulation is an agency brought into existence by European Union. The crypto assets which are currently not under the provision by MiFID are going to be brought under regulatory framework in MiCA. The framework at its basic scope doesn’t apply to NFTs and other qualifying financial assets under MiFID.
The regulation will be implemented across the European Union and it is believed that the permission of national laws is not mandatory for the implementation. This strategy ensures efficient and standardized access to the cutting-edge crypto-asset markets across the single market while also maintaining consumer safety.
The Objectives of MiCA!
Essentially four objectives have been set up by the EU for MiCA to achieve.
- To create a stringent and sound legal frame work to ensure that the legal parameters are not compromised in all levels.
- Proposing a framework that allows innovation and competition in the business and prohibit any kind of malpractices.
- The protection of the crypto investors at all times
- The financial stability of the market has to be intact at all times.
European Union’s Fears!
As MiCA came into existence, the scope of work for the regulatory body increased rapidly as it has to act as a regulatory body for all the 27 countries which have agreed to be part of European Union’s agency.
The major fear that is persistent with the European Union is that, if they will be able to recruit enough employees and work force to efficiently regulate the market and help the crypto industry grow.
The European Banking authority Jose Manuel Campa went on to make the official statement that, the agency is lacking behind in the capacity to regulate the digital assets market, and if the agency fails to recruit the appropriate number of employees with accurate knowledge, then the entire agency will be labelled as a failure.
As 2025 approaches, Campa told the FT, the EBA is concerned about figuring out the mechanics of executing its new powers because it won’t know which cryptocurrencies it would regulate.
Campa also acknowledged that there is high demand for crypto talent, but there is a scarcity in supply to satisfy that demand. Logistically speaking, the agency will soon exhaust most of its funds finding the right recruit to regulate the digital asset market.
From a personal point of view, the MiCA is a great step by European Union towards regulating the digital asset industry. But the question to consider now is whether the agency will be able to recruit the right people at the right time or not. If the agency is successful, then the EU’s decision will reap huge benefits in the long run. If the agency fails, then all the efforts towards making the agency will go down the drain.