The European Securities and Markets Authority (ESMA) is going to implement a wide-ranging plan to flag risks associated with cryptocurrency as it goes ahead with the Markets in Crypto-Assets (MiCA) regulation.
The ESMA, the financial regulator of the European Union (EU), has regularly cautioned consumers in the continent about the risks of cryptocurrency.
On January 16th, the body reiterated that MiCA provides “no safe harbour” as cryptocurrency remains “highly volatile and speculative.”
MiCA institutes uniform EU market rules for cryptocurrencies that are currently not regulated by existing financial services legislation. It will regulate public offerings of crypto assets and by ensuring consumers are better informed about their associated risks.
Transparency, disclosure, authorisation and supervision of transactions are the goals of the regulation, as per the ESMA.
The ESMA, along with the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA), and the European Central Bank (ECB), decided to seek comments from all the stakeholders in three phases before MiCA gets fully implemented.
It isn't the first time that the EU’s financial regulator has issued a warning to consumers about the risks related to cryptocurrency.
When the first set of consultation package was released in July 2023, the ESMA Chair Verena Ross was quick to warn consumers,
“We also want to remind consumers that, even with the implementation of MiCA, there will be no such thing as a safe crypto-asset.”
Once implemented, MiCA will let crypto exchanges and wallet providers operate across the 27-nation bloc with one license.
MiCA is being hailed as the trendsetter for other global regulators to follow so that the crypto sector can be governed efficiently.
This article is for informational purposes only and not intended as investment or financial advice. It contains opinions and speculations that are subject to change without notice.
The author and publisher disclaim any liability for decisions made based on the content of this article. Readers are advised to conduct their own research and consult a financial advisor before making investment decisions.
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6 days ago, Feb 14, 2024