The European Union in the final Agreements on Crypto Asset Market Laws (MiCA) last week. With the law due to come into force soon, the European Central Bank (ECB) is currently concerned about the likelihood of digital asset regulation becoming fragmented between member countries of the bloc.
According to a Financial Times report, the ECB wants to issue stern warnings to eurozone countries on the need to “harmonise” the regulation of digital assets. The warning will be published this week and will highlight the dangers of national regulators getting ahead of pending EU rules on digital assets.
An ECB supervisory board meeting with regulators from 19 EU member states is also scheduled for later in July to discuss the implementation of the MiCA bill.
A eurozone regulator said it would be difficult to meet ECB requirements. The unnamed official noted that regulators are already under pressure from banks and digital asset companies to clarify the market. Waiting another 18 months for the MiCA to harmonize regulations will only increase this pressure.
” It’s very difficult. With MiCA [the EU’s digital regulation package] In 18 months, is it better to say “until it’s integrated, do what you want, there are no regulations” or is it better to try to control the situation? said the national regulator.
However, some experts expressed support for the ECB’s decision. Richard Gardner, CEO of digital currency exchange Modulus, said the ECB’s decision made sense. Without uniform regulation, digital asset firms could try to game the system by “buying favorable jurisdictions”.
He added that different rules could also create confusion and unequal conditions of competition for multinational operators. EU countries like Germany, France, and the Netherlands have so far made progress in regulating digital assets.
The EU is already working on more digital asset regulations
The EU is moving from the MiCA bill to more digital asset-focused regulations. The EU is already deliberating on a bill to create a dedicated and independent Anti-Money Laundering Authority (AMLA) which, among other things, will provide AML oversight of digital assets.
In another proposal, ECB chief Christine Lagarde suggested the EU look into regulating digital asset staking and lending activities. Lagarde even suggested naming the regulation MiCA II.
In the meantime, the EU also intends to regulate proof-of-work bulk reward mining as part of environmental sustainability regulations. Attempts to regulate bulk reward mining in MiCA have failed.
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