The plenary session of the European Parliament approved the first one this Thursday European regulation on cryptoassets to facilitate monitoring, prevent money laundering, financial crimes, and improve the protection of customers and consumers. The new European regulations, approved by 529 votes to 29 and 14 abstentions, will come into effect in July and the rules will be gradually implemented from next year to allow time for the financial sector to adapt. “They mark the end of the jungle law of the unregulated cryptocurrency market and the beginning of a new era for a safer and more regulated cryptocurrency market,” said a Member of the European Parliament from Catalonia, who is co-sponsor and co-sponsor of the text. Ernest Urtasun.
The new legal framework, which must be definitively approved by the Council in the coming days, consists of two regulations. The first is a regulation on transfer of funds (TFR), and the second relates to cryptoactive markets (MiCA). The aim of both is to ensure that crypto-asset transfers, like any other financial transaction, can be monitored at all times and that suspicious transactions are blocked and consumers are better informed about the risks, costs and expenses associated with their operations.
To do this, as in traditional finance, information on the origin and beneficiary of the asset must “travel” with the transaction and be stored at both the origin and destination of the transfer. Regulation will cover Transactions over 1,000 Euros from non-hosted wallets (crypto-asset wallet address of a private user) when interacting with other hosted wallets managed by crypto-asset service providers. On the other hand, it will not apply to person-to-person transfers made without a provider or between providers acting on their behalf.
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The new framework also provides safeguards against market manipulation, money laundering, terrorist financing and other criminal activities. For example, to counter money laundering risks, the European Securities and Markets Authority (ESMA) public registry of crypto asset service providers Does not comply with regulations and operates without permission in the European Union. The regulation will also promote market integrity and financial stability by regulating the public offering of crypto assets.
“We have seen in recent months that strict regulation and oversight is necessary. Our projects like FTX, Terra Luna, Celsius and Voyager crashed. We have seen many individual investors who have been deceived by false promises or false hopes losing large sums of money, and while the cryptocurrency market is too small to trigger systemic risks, we recognize that there are more and more connections between the cryptocurrency markets and traditional services. financiers” justified the commissioner Mairead McGuinness During the preliminary discussion organized by the plenary session of the European Parliament.
“TFR will represent the most ambitious flow control rules legislation in the world, with full traceability on crypto transfers from the first euro and obligations for crypto companies to mitigate money laundering and sanctions avoidance risks,” Urtasun said. Legislation that will support the fight against money laundering and close existing gaps in consumer protection and financial control in cryptocurrency markets. However, when it comes to MiCA, it’s still “there is so much to do” in areas such as loans and betting, decentralized finance, or the environmental impact of cryptocurrency mining. “It’s a step forward, but not enough,” he guesses.