The EU’s MiCA Crypto licensing regime set for approval as lawmakers signal support

Cross-party EU lawmakers have signaled continued support for the bloc’s landmark Markets in Crypto Assets Regulation (MiCA) in a Wednesday debate, suggesting the licensing law will easily pass a vote due on Thursday.

MiCA, whose policy outlines were agreed last year, will allow crypto exchanges and wallet companies to offer regulated services across the bloc and require stablecoin issuers to hold sufficient reserves.

Speakers from the parliament’s largest groupings – the European People’s Party, Socialists and Democrats, Renew Europe and European Conservatives and Reformists – welcomed the proposals. Assuming all of those parties’ members vote accordingly, the law looks set to comfortably win the majority needed in a vote scheduled for Thursday.

“Europe can be proud of the step we are taking today,” Lídia Pereira, of the centre-right EPP, which makes up the largest political grouping in the European Parliament, told her lawmakers.

“As we have seen in recent months, strict rules and supervision are very necessary,” said the European Commission’s Mairead McGuinness, citing the collapse of crypto companies FTX, Celsius, Voyager and stablecoin terraUSD, referring to provisions meant to protect consumers, avoid market abuse and limit money laundering.

MiCA should “restore the trust damaged by the FTX case” and bring stability to the sector, said Stefan Berger, the German center-right lawmaker who led parliament’s negotiations on the law, adding that it will put the EU “at the forefront of the token – the economy.”

Lawmakers also proposed support for a separate but controversial anti-money laundering measure known as the transfer of funds rules that require crypto providers to collect details about users’ identities.

Agreement on the laws marks “the end of the ‘Wild West’ era for the unregulated world of cryptoassets,” said the Green Group’s Ernest Urtasun, adding that the sector had “provided a safe haven for fraudsters and international criminal networks.”

The deal, struck by negotiators for Parliament and the EU Council, which represents member states, must be formally rubber-stamped by both institutions before the measures take effect, a step that has been hampered by administrative delays in finalizing and translating the text.

The MiCA rules will take effect 12 to 18 months after the legislation is published in the bloc’s official journal, which is likely to happen in June – potentially making the EU the first major jurisdiction with a far-reaching crypto law.