MiCA Regulation Deadline Approaches for Crypto Industry
The end of this month marks the first significant compliance deadline under the EU’s new Markets in Crypto Assets (MiCA) regulation. Signed off last year, MiCA introduces extensive rules for crypto exchanges and operators to protect investors, enhance consumer protections, and tighten anti-money laundering controls.
From June 30, stablecoin issuers must have an e-money license to operate in the EU and demonstrate adequate reserves. Companies like Binance and Coinbase are preparing to delist non-compliant stablecoins. Coinbase’s Chief Legal Officer, Paul Grewal, emphasized the new stringent standards, which he believes will improve industry transparency and align it with traditional finance regulations.
Nasdaq-listed Coinbase, which has a significant presence in Ireland, has chosen the country as its main regulatory hub for MiCA compliance in the EU. The Central Bank of Ireland will begin accepting applications in Q3 2024 and is prioritizing MiCA implementation and industry engagement.
The Netherlands has already started its application process, potentially attracting companies seeking MiCA approval. A spokesperson for the Central Bank of Ireland confirmed plans to open the “authorization gateway” in early Q3 and to host an industry event in July to clarify application expectations.
While Binance has established a presence in Ireland, it has not yet decided on its regulatory location for MiCA. Binance aims to comply with MiCA requirements and will disclose details in due time.
Consultant Cara Hennessy highlighted Ireland’s reputation for strong regulatory governance but noted concerns about the time required to process MiCA applications. She welcomed the Central Bank’s engagement with the industry, emphasizing the need for clarity on what constitutes a complete application.
MiCA introduces multiple deadlines over the next year, with rules for crypto asset service providers taking effect in December, followed by a 12-month grace period for compliance. Coinbase, Kraken, and Gemini had lobbied for an 18-month grace period but must now adhere to the 12-month timeframe in Ireland.
Achieving consistency across jurisdictions is a challenge, with different countries opening applications at varying times. Cathal Houlihan of Valentia Partners stressed the importance of uniformity in regulatory practices.
Anti-money laundering controls, formalized under MiCA, are less contentious for major crypto firms, which have already strengthened their AML and KYC measures. The regulation is seen as an opportunity for further industry cleanup.
Andrew Forson of The Hashgraph Association views MiCA as providing greater investor confidence, driving them to seek investment opportunities in early-stage crypto and Web3 startups in Ireland. While MiCA presents initial challenges, it will ultimately distinguish compliant companies in the industry.
Source: thecurrency.news
