(Kitco News) - European Union legislators have postponed the vote on the Markets in Crypto Assets (MiCA) Bill until February 2023, a move that will likely result in additional delays in the implementation of a licensing regime for crypto companies operating in the EU.
Originally, the European Parliament was scheduled to make its final vote on the legislation during an upcoming plenary session in December, but those plans have now been pushed back.
The need to translate the draft into the 24 official EU languages was cited as the reason for the delay. Due to the length and the highly technical nature of the bill, this process has taken longer than expected, so an extension was needed.
The bill was drafted to deal with several areas of concern in the crypto ecosystem, including the need to set reserve requirements for stablecoins in an effort to avoid another TerraUSD-style collapse that sent shockwaves across the industry. The initial text was first approved in June, and the final text was published in October.
Lawmakers and the national governments that make up the EU’s Council still need to formally sign off on the text of the bill before it can become official. Once it has been approved by the Parliament and European Council, the text will be added into the EU’s Official Journal, which initiates a lengthy rulemaking process.
The provisions outlined in the MiCA, which include the requirement for crypto companies such as wallet providers and exchanges to seek authorization from national regulators, will go into effect 12 to 18 months after the final law is published in the Official Journal.
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During the time it takes for the law to go into effect, Europe’s financial supervisors and the European Commission will negotiate and come to an agreement on the new rules and iron out the final details of implementation.
Due to this recent delay and the subsequent waiting period, even after the law is entered into the Official Journal, the new rules outlined in MiCA are not likely to go into effect until February 2024 at the earliest.
According to Peter Kerstens, the European Commission’s (EC) technological innovation and cybersecurity policy adviser, once the MiA bill becomes law it will introduce multiple changes to the market, including strict requirements designed to prevent collapses like those of Terra and Luna, and treating non-fungible tokens (NFTs) as cryptocurrencies.
