As the bulk of Europe’s Markets in Crypto-Asset Regulations (MiCAR) come into force at the end of this year, Germany is in a peculiar position. Because of its failure to pass some legislation, German companies cannot be granted MiCAR crypto licenses by local regulator BaFin. But foreign companies licensed elsewhere are free to operate in Germany and throughout the EU.
Europe implemented MiCAR as a regulation so that it would apply as it stands throughout the European Union. That contrasts with an EU directive that would require each country to implement it into national law. Given MiCA is a regulation and hence already applies in Germany, why does it matter that Germany’s ruling coalition collapsed earlier this month?
Some MiCA details are country specific. For example, each country has to designate a regulatory body to issue licenses for crypto asset service providers (CASP). That would be BaFin in Germany. Except that the designation of BaFin is part of a draft law that has not yet been passed. And given the collapse of the government coalition, its passage any time soon is unlikely.
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