EU cryptocurrency regulations pt. III: When will implementation happen?

An update on the MiCa regulations mentioned in previous months on the news section.

The provisional agreement established on the MiCA (Markets in Crypto Assets) Regulation on June 30 received support from the Economic and Monetary Affairs Committee of the European Parliament (ECON) on October 10. 

When may full implementation be anticipated?

Before the legislative procedure is completed, the EU still has a few obstacles to overcome. These include the official journal publishing, a final vote in the EU Parliament Plenary, and translation into the official languages of the EU.

Both the MiCA and the TFR are anticipated to go into effect in the first quarter of 2023, barring any unforeseen obstacles. The date of entry into force, however, does not coincide with the day on which all of the rules become effective. For this, two crucial deadlines are especially important both for cryptocurrency asset service providers and for cryptocurrency asset and stablecoin issuers:

  • Stablecoin restrictions will be in effect starting in Q1 2024, around 12 months after the regulations take effect. 
  • All other laws, including licensing of crypto asset service providers and the TFR, will start to apply in Q3 2024, or 18 months after the regulations take effect.

What procedures must be taken in order to reach the finish line?

The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA), in particular, will still need to retain their stamina (and speed), supported by enough resources, to complete a few more tasks like development of supervisory policies and procedures, as well as guidelines – criteria for the classification of crypto assets as financial instruments or crypto assets under MiCA, management board suitability requirements, etc.

However, thanks to MiCA and TFR’s harmonized crypto regulatory framework for the EU, businesses won’t have to wade through a maze of regulations. The draft regulatory technical standards and guidelines will give a model for other regulators across the world, as well as more legal clarification and certainty for stablecoin issuers, crypto asset service providers, and crypto asset offerors planning to operate in the EU.