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#1 26-03-2024 21:32:20

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From: Paris - France
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European regulation of cryptocurrencies is nearing!

European regulation of cryptocurrencies is nearing: the ESMA publishes its final report

The European Securities and Markets Authority (ESMA) has taken important steps to regulate the crypto-asset industry by publishing its first final report and launching a third consultation package under the Crypto-asset Markets Regulation (MiCA).

ESMA finalises first rules for crypto-asset service providers
In its first final report, ESMA presented proposals on the information required for the authorisation of crypto-asset service providers (CASP), the notification process for financial entities intending to provide crypto-asset services. crypto-assets, the evaluation of the planned acquisition of qualifying interests in PSAPs, and how PSAPs should handle complaints.

The report aims to promote fair competition between PSAPs and create a safer environment for investors across the European Union.

ESMA's Securities and Markets Stakeholders Group has called for a "level playing field" in which financial institutions providing crypto-asset services are subject to the same oversight and scrutiny. regulation than intermediaries offering similar financial services.

The group approved a 'two-track approach' involving reporting requirements for regulated financial entities that broadly align with authorization requirements for other entities.

"By striking a balance between protecting investors and promoting innovation, regulators rightly aim to promote trust in the cryptocurrency ecosystem and ensure its long-term sustainable growth," comments Kok AsiaNext CEO Kee Chong on the final report.

Third consultation package asks for feedback on MiCA
ESMA's third consultation package seeks stakeholder comments on four sets of proposed rules and guidelines.

These cover detecting and reporting suspected market abuse in crypto-assets, policies and procedures for crypto-asset transfer services, suitability requirements for certain crypto-asset services, and operational resilience of ICT for entities under MiCA. Stakeholders have until June 25, 2024 to provide feedback.

"As crypto markets are known for their high volatility, a robust risk framework helps an exchange minimize the impact of market uncertainties for institutional traders. Aligning with best practices in the wider financial industry, it is essential for stock exchanges to engage in proactive risk management," adds Kok Kee Chong.

The European Banking Authority (EBA) has also been consulting on measures under the MiCA Regulation since its completion in 2023. Earlier in March, the EAB and ESMA published a draft regulation for stablecoin issuers.

As the cryptocurrency ecosystem has seen worrying developments, such as the collapse of crypto-asset service providers, ESMA has incorporated these lessons into the regulatory framework.

"Anything worth having is worth going for - all the way." - J.R. Ewing



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