EU Regulators Call For MiCA 2.0 For Better Crypto Regulation I Tokenhell

The latest news report showed that the European Union regulators are keen on introducing new cryptocurrency laws aside from the already enacted rules contained in the MiCA 1.0, signifying the introduction of MiCA 2.0 is imminent.

According to the report, the European Union recently drafted the Markets in Crypto Assets MiCA law. The law was published on June 9 and is expected to come into force in June end. And crypto entities are expected to comply or face severe punishments.

However, even before the law took effect, the EU policymakers were already clamoring for a new version of the MiCA law. According to Francois Villeroy De Galhau, the Governor of the Bank of France, regulators should create MiCA version two for better regulation of the digital asset industry.

The governor’s suggestion reportedly aligned with the repeated calls from Christine Lagarde, the European Central Bank President. He reportedly emphasized the importance of the second version of MiCA law to solve current issues like NFTs, Lending, DeFi, and Staking.

Currently, reports show that the EU Commission is yet to start working on the suggested MiCA 2.0. However, they have 18 months to submit feedback on the lapses of the first version.

Furthermore, the feedback is expected to cover topics not addressed in the MiCA 1.0. Some of these topics are staking, decentralized finance (DeFi), non-fungible tokens, and the like, as per the report.

Legal Experts Considered MiCA 1.0 Rules Comprehensive

Reports showed that before any work can commence on the suggested new version, there must be significant issues emanating from one or more of the topics stated above. Nonetheless, the regulators are squarely focused on implementing MiCA 1.0.

The chief regulatory compliance at Keyrock (a market maker), Laura Chaput, stated that he believed MiCA law was comprehensive enough. Also, he suggested that regulators should carefully weigh the potential positive and negative impacts it would have on the market before contemplating further rules.

He added that it is crucial to give crypto entities enough room to adapt to the new legislation and analyze its effectiveness. Furthermore, the chief legal officer at Flowdesk, Anne-Sophie Cissey, commented that the regulation of the crypto industry was long awaited.

She added that the current trend of local banks engaging the industry makes regulation imminent. Cissey highlighted that more clear regulations and supervision are required in the crypto industry.

In addition, Laura Chaput opined that despite the crypto industry’s broad compliance with rules, it is essential not to overwhelm it with too many regulations, as many government agencies are trying to solve multiple issues concerning the industry at a time.

MiCA 2.0 Would Focus On Topics Not Covered By MiCA 1.0

Chaput said amidst the Anti Money Laundering (AML) regulation, MiCA, the Data Act, the Travel Laws, and others addressing the crypto industry; regulators should strike a balance and give time for the industry to adapt before introducing new rules.

Even though the creation of a new MiCA is not materializing anytime soon, regulators are actively discussing what could be included in it when the time comes for it to be updated.

Anne-Sophie Cissey pointed out that the introduction of MiCA marked the start of regulation in the blockchain-supported financial . Nonetheless, it didn’t cover many crucial subdivisions of the sector, like lending, DeFi, Utility, tokens classification, token governance, Liquidity pool, etc.

Furthermore, Cissey said since many people are already engaged in these sectors, the regulators need to create a comprehensive law to guide them just like they did with the divisions covered in the MiCA. He added that they deserve regulatory clarity and protection too.

Meanwhile, the CEO of Monerium, Jon Helgi, claimed that the proposed MiCA 2.0 should target mainly the subdivisions left out of the MiCA 1.0 instead of reinstating the existing laws.

In addition, he suggested that the current digital money regulations should continue to man the crypto industry.

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