The final vote on the European Union’s (EU) much-awaited set of crypto rules, known as the Markets in Crypto Assets regulation (MiCA), was deferred to April 2023. It marks the second delay in the final vote, which was previously postponed from November 2022 to February 2023.
The latest delay is due to a technical issue where the official 400-page document couldn’t be translated into the 24 official languages of the EU, according to The Block. Legal documents like the MiCA, which are drafted in English, must comply with EU regulations and be published in all 24 official languages of the union.
The first delay in November 2022 that deferred the final vote to February was also caused by translation issues. A delay in the final vote means European financial regulators must wait longer before drafting the implementation rules for the legislation. Once the MiCA has received official approval, the financial regulators have 12 to 18 months to create the technical standards.
The European parliamentary committee passed the MiCA legislation in October 2022, nearly two years after it was first introduced in September 2020. The second delay comes even when there has been a growing demand for approval of the legislation, especially in the wake of the crypto contagion caused by FTX.
Stefan Berger, a member of the European Parliament’s economics committee, has described the FTX collapse as one of the “Lehman Brothers moments” that “must be prevented,” when arguing for the necessity of regulations such as MiCA.
Shame! The #FTX/#Alameda case has cost enormous trust. Such Lehman Brothers moments must be prevented in the crypto space. That’s exactly what #MiCA is for. Crypto assets are not play money. Crypto asset service providers must ensure internal risk management mechanisms. https://t.co/zNrB8CdUbU
— Stefan Berger (@DrStefanBerger) November 9, 2022
With MiCA, European policymakers aim to set a standard regulation to establish harmonized rules for crypto assets at the EU level, thereby providing legal certainty for crypto assets not covered by existing EU legislation.
The crypto regulation will establish guidelines for the operation, structure and governance of issuers of digital asset tokens. The legislation will also offer rules on transparency and disclosure requirements for issuing and trading crypto assets.