EU's Landmark Crypto Regulation, MiCA, Postponed to 2023 Amidst Stablecoin Cap Controversy

The EU's Markets in Crypto Assets (MiCA) legislation faces a delay in voting due to the text's complexity. Despite the release of the final text in October, the European Parliament's vote planned for December has been abandoned. A proposed cap on non-euro-denominated stablecoins has also been subject to debate, with rumors of its adjustment or removal circulating. The MiCA regulation requires approval from both the European Parliament and the European Council before implementation, with an estimated 12-18 month period from its publication in the EU's Official Journal.

EU's Landmark Crypto Regulation Faces Delay: MiCA Postponed to 2023

Brussels, November 4, 2022 - The European Union's (EU) groundbreaking Markets in Crypto Assets (MiCA) regulation is set to experience a significant delay, with the European Parliament's planned vote on the legislation in December now abandoned, Coindesk reported on Friday.

Despite the publication of the final draft text last month, the sheer length and complexity of the document have prompted a postponement of the vote until early next year, according to a European Parliament spokesman. The delay underscores the intricate nature of the crypto asset landscape and the EU's determination to craft a comprehensive and effective regulatory framework.

Contentious Stablecoin Cap Complicates MiCA Timeline

Among the last-minute details that have complicated MiCA's progress is a controversial proposal to impose a cap on the market share of non-euro-denominated stablecoins. The October draft included a provision limiting the activity of such stablecoins within the eurozone to a daily volume of 1 million transactions and 200 million euros ($198 million).

This move has drawn criticism from the crypto industry, which views it as an attempt to favor euro-pegged stablecoins and potentially stifle innovation and competition. Amid growing concerns, rumors have emerged that the cap could be adjusted or even scrapped altogether.

Next Steps for MiCA's Enactment

Before MiCA can become law, it must undergo a rigorous process involving approval by both the European Parliament and the European Council. Once the final version of the regulation is agreed upon, a 12 to 18-month implementation period will commence from the date of publication in the EU's Official Journal.

The delay in the MiCA vote is a testament to the EU's commitment to thorough and balanced regulation in the rapidly evolving crypto asset sector. The postponement provides lawmakers with additional time to address industry concerns and ensure that the final legislation strikes the right balance between protecting consumers, fostering innovation, and maintaining financial stability.

As the EU continues to grapple with the complexities of crypto asset regulation, the MiCA delay underscores the challenges and opportunities that lie ahead for both the blockchain industry and policymakers worldwide. The ultimate shape of MiCA will undoubtedly have far-reaching implications for the future of crypto assets in the European Union and beyond.