The first iteration of Europe’s MiCA regulations for cryptocurrencies explicitly sidestepped decentralized finance, although when put under the microscope, many so-called decentralized entities might be found to be centralized. MiCA also covers stablecoins, referred to as e-money tokens (EMTs) or asset-referenced tokens (ARTs). Hence, what happens under MiCA if a crypto-asset is both decentralized and a stablecoin? The DAI, one of the oldest stablecoins is decentralized, and so is its replacement the Sky USDS.
The DAI’s governance body, MakerDAO, has been rebranded to Sky and token holders recently commissioned a legal report that concluded that the MiCA e-money token clauses do not apply to it, and EU exchanges can list it. An advisor to the European Commission who was involved in MiCA’s drafting asserted that exchanges can only list regulated EMTs and ARTs, saying it would be up to the European courts to decide, if in doubt.
Notably, one of the legal clauses at the center of the debate is the same one that regulator ESMA published a clarification on last week, emphasizing that EU crypto exchanges must de-list unregulated stablecoins (EMTs and ARTs). Tether is the biggest one this would apply to. At the time, we noted that the topic must be somewhat unclear, otherwise ESMA would not have needed to seek clarification from the European Commission.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
