EU’s Crypto Licensing Regime Set for Approval as Lawmakers Signal Support

European Union lawmakers from multiple parties signaled continuing support for the bloc’s landmark Markets in Crypto Assets regulation in a Wednesday debate, suggesting the licensing law known as MiCA will easily be approved in a vote scheduled for Thursday.

MiCA, whose main political outlines were agreed upon last year, would allow crypto exchanges and digital-wallet companies to offer regulated services across the bloc and requires stablecoin issuers to hold sufficient reserves.

Speakers from the parliament’s biggest groupings – the European People’s Party, Socialists and Democrats, Renew Europe and European Conservatives and Reformists – welcomed the proposals. Assuming all those parties’ members vote accordingly, the law seems set to comfortably gain the majority needed for the legislation to pass.

“Europe can be proud of the step we're taking today,” Lídia Pereira of the center-right EPP, which constitutes the biggest political grouping in the European Parliament, told fellow lawmakers.

“As we've seen in recent months, stringent rules and supervision are very much needed,” the European Commission’s Mairead McGuinness said, citing the collapse of crypto companies FTX, Celsius Network and Voyager Digital and of the terraUSD stablecoin, and referring to provisions intended to protect consumers, prevent market abuse and curb money laundering.

MiCA should “restore the trust that was damaged by the FTX case” and bring stability to the sector, said Stefan Berger, the German center-right lawmaker who led the parliament’s negotiations on the law, adding that it will put the EU “at the forefront of the token economy.”

Lawmakers also suggested support for a separate but controversial anti-money-laundering measure known as transfer-of-funds rules, which require crypto providers to gather details of their users’ identity.

Agreement on the laws marks “the end of the ‘Wild West' era for the unregulated world of crypto assets,” said the Green grouping’s Ernest Urtasun, adding that the sector had “provided a safe haven for fraudsters and international criminal networks.”

The deal struck by negotiators for the parliament and the EU’s Council, representing member states, must be formally rubber-stamped by both institutions before the measures pass into law, a step that has been hampered by administrative delays in completing and translating the text.

MiCA rules will take effect 12 to 18 months after the legislation is published in the bloc’s Official Journal, which is likely to happen in June – potentially making the EU the first major jurisdiction with a wide-reaching crypto law.

Read more: High Hopes for EU’s MiCA Law With Final Vote Imminent