ESMA publish its first consultation package under the Markets in Crypto Assets Regulation

The European Securities and Markets Authority (ESMA) is an independent EU Authority that contributes to safeguarding the stability of the European Union’s financial system by enhancing the protection of investors and promoting stable and orderly financial markets. ESMA is seeking input on proposed rules for cryptoasset service providers (CASPS).

The regulation of crypto-assets within the European Union has been an area of increasing interest and concern due to the rapid growth of the cryptocurrency market. ESMA has been closely monitoring developments in this sector to ensure that appropriate regulatory measures are in place to address potential risks and challenges associated with crypto-assets.

The Markets in Crypto-Assets Regulation (MiCA) is a regulatory framework proposed by the European Commission to establish harmonized rules for crypto-assets and related services across the EU. The regulation aims to create a clear regulatory framework for issuers of crypto-assets, service providers operating in the crypto-asset space, and market participants. It seeks to ensure investor protection, market integrity, and financial stability.

Further to the press release issued last month, the consultation package is the first of three consultation packages, ESMA’s effort to gather input from stakeholders and market participants on the regulatory framework proposed under MiCA. This is a common practice in the regulatory process, as it allows relevant parties to provide feedback and insights on the proposed regulations before they are finalized.

Verena Ross, Chair of ESMA, said:

โ€œThis first consultation package is an important milestone for ESMA in the implementation of the MiCA framework. It translates our ambition to set high regulatory standards in the EU for crypto-asset related activities into concrete requirements.
We are determined to ensure entities involved in crypto-asset related activities understand that the EU is not a place for forum-shopping. We also want to remind consumers that, even with the implementation of MiCA, there will be no such thing as a safe crypto-asset.โ€

Stakeholders, including financial institutions, crypto-asset issuers, service providers, investors, and the public, are encouraged to participate in the consultation process by submitting their opinions, concerns, and suggestions. ESMA reviews the feedback received during the consultation period and takes it into consideration when finalizing the regulatory standards. Any comments are to be received by no later than 20 September 2023.