The Markets in Crypto Assets (MiCA) law created by the European Union intends to regulate the crypto asset space; however, it has not yet created a surge in euro-denominated crypto transactions. This particular observation had been made in an ESMA study. Even with becoming the very first legal framework for crypto assets and stablecoins, its effect on EU transaction volumes remains to be seen. ESMA mentions that the regulation shouldn’t raise euro volumes yet but can be a growth driver down the road.
The regulation, which will become completely relevant in 2024, seeks to offer greater protection for purchasers in the EU crypto market. It includes a crypto asset rules framework and particular provisions for stablecoins. These actions are anticipated to produce a safer and more controlled crypto trading landscape eventually. Nevertheless, the euro still plays a minor role in cryptocurrencies after the MICA announcement.
Euro’s Insignificant Role in Cryptocurrency Transactions
Worldwide fiat-to-crypto trading volumes fell from 30% in 2021 to 20% in 2023 during a crypto winter, but the market has since recovered. This particular change is partially because of stablecoins, which are associated with national currencies and allow spread adjustments within the crypto ecosystem. Regardless of these worldwide shifts, the euro remains an insignificant participant in the industry, comprising just about 10% of transactions.
With its increasing role, Stablecoins today constitute over 60% of all cryptocurrencies. Additionally, they display an important concentration of trading volume, with ten exchanges processing roughly 90% of trades. The largest of all is Binance, which sells nearly half of the world’s volume. This concentration makes major platforms an important player in the cryptocurrency trading market.
Public Input Sought on MiCA Regulations
ESMA delivered its newest report on MiCA regulation on March 25, further enhancing the EU crypto regulation landscape. Now, the authority is entering the third consultation stage, with all the rules open to public comment. This is another step in ESMA’s general strategy to produce a secure and regulated crypto marketplace in the EU. The last draft of the law explains legislative actions implemented throughout Europe.
Read Also: MicroStrategy Takes a $2 Bln Hit With Highest Short Losses Since March
The post MiCA Regulation’s Impact on European Crypto Market Minimal: ESMA appeared first on CoinGape.
Earn more PRC tokens by sharing this post. Copy and paste the URL below and share to friends, when they click and visit Parrot Coin website you earn: https://parrotcoin.net0
PRC Comment Policy
Your comments MUST BE constructive with vivid and clear suggestion relating to the post.
Your comments MUST NOT be less than 5 words.
Do NOT in any way copy/duplicate or transmit another members comment and paste to earn. Members who indulge themselves copying and duplicating comments, their earnings would be wiped out totally as a warning and Account deactivated if the user continue the act.
Parrot Coin does not pay for exclamatory comments Such as hahaha, nice one, wow, congrats, lmao, lol, etc are strictly forbidden and disallowed. Kindly adhere to this rule.
Constructive REPLY to comments is allowed