Today the European Parliament’s Economics and Monetary Affairs Committee voted in favor of the Regulation on Markets in Crypto Assets (MiCA). While the vote on the full draft passed with 31 MEP in favor and 23 against, there were other votes earlier today.
The Greens and S&D political parties proposed an amendment to effectively ban energy hungry Proof of Work (PoW) cryptocurrencies such as Bitcoin. They lost the vote on that amendment a few hours earlier.
However, Europe’s legislative process is quite cumbersome, and there is still one more hurdle to pass. The next step is the trilogues, an agreement between Parliament, the European Council representing the member states, and the European Commission.
While this should take a couple of months, it’s possible that the political parties that proposed the Bitcoin ban could slow the trilogues and raise the same issue again. If that happens, instead of the Economics Committee voting, it would be a full Parliamentary vote.
Additionally, Europe is working on a taxonomy for sustainable activities and the Bitcoin matter could also raise its head there.
If the legislation makes it through the trilogues without delay, companies will be expected to comply within six months, so later this year.
Just re-capping, MiCA regulates three types of assets, asset-referenced tokens, e-money tokens (stablecoins) and other crypto-assets. Security tokens are covered by separate legislation, the so-called DLT pilot regime.
Previous drafts of the MiCA legislation extended to more than 460 pages and regulates topics such as whitepapers and the conduct for crypto token issuances, service providers, and codes of conduct. However, given the crypto sector has expanded substantially compared to when MiCA was first drafted, some activities are not yet covered. Additional proposals will be submitted within 18 months of the law coming into force.