In a recently published interview with Verena Ross, Chair of the European Securities and Markets Authority (ESMA), Ross spoke about the Markets in Crypto-Assets Regulation (MiCA) that was passed in June.
“It is important to remember that even with the implementation of MiCA, which is clearly a step forward, there will be no such thing as a safe crypto-asset,” said Ross. “Consumers need to be aware that MiCA does not provide the same protection as for traditional financial products.”
A key aspect of MiCA is it enables a crypto asset service provider (CASPs) to register in one country and be able to operate throughout the European Union. Currently many countries only have requirements for service providers to comply with anti money laundering legislation. In contrast, MiCA is far broader covering the authorization of CASPs, crypto product disclosures and aiming to improve market integrity.
Ross commented on the volatility of the crypto market and that it is “prone to fraud”.
While the European Banking Authority is the primary rule setter for stablecoins, ESMA is responsible for the details for everything else. Hence, last month ESMA launched the first of three consultations. The initial one covers topics relating to CASPs, ranging from existing regulated entities notifying their local regulator, to complaint handling by CASPs and how they manage conflicts of interest.EU regulator: no such thing as a safe crypto-asset