European Union Markets in Crypto-Assets Regulation and its impact on crypto-asset issuers and service providers

Abstract

The current laws for crypto-assets are not sufficient or are fragmented between countries. The European Union has taken the initiative to create a harmonized comprehensive regulation for crypto-assets. This thesis aims to analyse MiCA to determine if the proposed regulation will reduce the risk inherent in crypto-assets while fostering innovation and identify consequences and possible future improvements. The results indicate that MiCA is effective and will create a single regulatory framework within the EU. The authorisation and compliance requirements are adjusted for each type of crypto-asset, setting stricter rules for ARTs and EMTs. It will create legal certainty for CAIs and CASPs, improve investor confidence, and ensure market stability. MiCA will serve as an example for further development of international rules for crypto-assets. However, MiCA will need to be improved across multiple dimensions, and interconnections between the crypto-assets and the traditional financial system will need to be addressed.