In a recent interview with Vishal Sacheendran, Director of MENA and Europe at Binance, he gave an overview of the upcoming regulations in the crypto asset markets (MiCA) in Europe. Vishal, who previously worked for a financial regulator in Abu Dhabi, explained that MiCA is a comprehensive set of regulations for cryptocurrencies that treats them like financial services. He pointed out that MiCA is standardizing registration and anti-money laundering requirements for crypto asset service providers across Europe, enabling passporting of licenses across the region.
Asked about the impact of MiCA on Bitcoin in particular, Vishal said that MiCA does not distinguish between different cryptocurrencies and treats them all the same. He mentioned that while MiCA is not the first regulatory framework in the world, it is the first in Europe and similar to what the UK does with its regulations.
Regarding the implications for companies operating as crypto-asset service providers (CASPs), Vishal explained that they will be regulated based on the services they provide rather than the asset class under-served. underlying. “…your cap requirements, your risk mitigations, it all revolves around the services you offer.” Different services such as custody, trading platforms and advice will have specific requirements and risk mitigation measures.
Vishal also mentioned that the MiCA regulations will have varying requirements depending on the size of the service providers. Large suppliers will have more capital and governance controls to ensure consumer protection. He noted that there is still more to come in terms of guidelines for trading and dealing with stablecoins and NFTs, remarking that “there will likely be separate tools developed for them in the future, but not yet. “.
Asked about the regulatory environment in Europe compared to the United States, Vishal pointed out that regulators often need time to catch up with innovation, and that the power of innovation drives the industry. He believes that crypto-friendly European regulations are attracting business and he expects more players to move into the region. “It’s only a matter of time before we see a lot more of these players and new startups come up with new, more innovative products or services,” Vishal said.
Regarding the global impact of the MiCA, Vishal suggested that other regions could adopt similar regulatory positions or incorporate aspects of the MiCA into their own legislation. However, he noted that growing the talent pool within the industry is also crucial for its development.
For everyday cryptocurrency users, Vishal stressed that they need to understand that companies in the industry are now treated as financial service providers under MiCA. He also highlighted the importance of the ability to passport licenses and serve the wider European market from a single hub.
Overall, MiCA regulation in Europe aims to provide a comprehensive framework for regulating crypto assets as financial services, bringing uniformity and consumer protection to the industry. Although some aspects are still under development, MiCA is expected to become law by the end of next year, with potential implications for the global industry.