EU Securities Watchdog Issues Cautionary Note on Crypto Regulations

By Consultants Review Team Wednesday, 18 October 2023

Investors will not be protected under European Union (EU) crypto asset market laws until at least the end of 2024, according to a statement issued by the EU markets watchdog European Securities and Markets Authority (ESMA).

Despite the fact that the group of nations was the first to approve a comprehensive set of rules to control crypto assets such as bitcoin, Ether, and others, these will not be fully implemented until December of next year. 

In other news, at their conference in Morocco on October 13, finance ministers from the G20 countries endorsed a plan for regulating crypto assets suggested by the Financial Stability Board (FSB) and the IMF.

Currently, crypto assets are unregulated under EU securities regulations, and the ESMA has stated that investors would not benefit from any EU-level regulatory safeguards under the new MiCA rules until December 2024.

"Even with the implementation of MiCA, retail investors must be aware that there will be no such thing as a'safe' crypto asset," stated the EU watchdog in a statement. "Can you afford to lose all the money you are planning to invest?" it went on to say. 

MiCA's Timeline

ESMA confirmed the schedule for MiCA in a statement, encouraging market players to begin planning for the changeover. Currently, ESMA is preparing to establish markets in crypto assets regulation (MiCA), which will improve safeguards for crypto holders and other stakeholders who are not currently governed by current legislation. 

The statement is unequivocal in stating that, in addition to the inherent risks of crypto-assets, MiCA laws on the provision of crypto-asset services will not be implemented until December 2024. While issuing a warning to investors, ESMA also advises them to always ask themselves the following questions before purchasing crypto-assets or associated products and services:

A. Can you afford to lose the entire amount of money you intend to invest?

B. Are you willing to accept large risks in order to get the advertised returns?

C. Are you familiar with the characteristics of the crypto-asset or associated products and services?

D. Are the companies/parties with which you are interacting reputable?

E. Have the firms/parties with which you are interacting been blacklisted by the relevant national authority?

F. Can you effectively protect the devices you use to buy, store, or transfer crypto assets, including your private keys, effectively?

Furthermore, organizations are able to continue operating without a MiCA licence for an additional transitional period. This means that holders of crypto assets may not benefit from all of MiCA's provisions until July 1, 2026.


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