EU Commission Proposal: Regulatory Package on Crypto-Assets

Abstract

On 24^th September 2020, the EU Commission has published a package of legislative proposals with the aim to create an EU framework on markets in crypto-assets, tokenisation of traditional financial assets and the use of distributed ledger technology (DLT) in financial services as part of the EU digital finance strategy. It includes an addendum to the “MiFID II” Directive 2014/65/EU clarifying that the existing definition of “financial instruments” includes “instruments issued by means of distributed ledger technology”; a proposal for a Regulation on Markets in Crypto-assets (MiCA) to cover crypto-assets falling outside existing EU financial services regulation, including “stablecoins” as well as e-money tokens; a proposal for a Regulation on a Pilot Regime for Market Infrastructures based on Distributed Ledger Technology an “EU passport” for cryptoassets. Related legislative procedures are already on track including general recommendations and first specific motions for amendments of the Commission’s proposals by the European Parliament. It can be expected that the final outcome will be a comprehensive MiFID-type framework (MiCA) on markets in crypto-assets.