ESMA Consultative Paper on Markets in Crypto-Assets (MiCA)
The European Securities and Markets Authority (ESMA), the markets regulator of the European Union, has published a second consultative paper on Markets in Crypto-Assets (MiCA) mandates. The paper seeks input from stakeholders on five key areas of MiCA.
Areas of Focus
In the 307-page document, ESMA seeks feedback on sustainability indicators for distributed ledgers, disclosures of inside information, technical requirements for white papers, trade transparency measures, and record-keeping for crypto-asset service providers (CASPs).
Sustainability Indicators
One area of focus is sustainability indicators. ESMA proposes using quantitative metrics such as energy consumption, greenhouse gas emissions, and waste production. Additionally, a qualitative statement on the impact of blockchain network nodes’ equipment on natural resources is suggested.
Post-Trade Transparency
ESMA suggests that CASPs should report trading and publication date and time, identification of the crypto-asset, pricing information, quantity, venue of execution, and transaction ID. Furthermore, CASPs would have the flexibility to store transaction data in their preferred format as long as it can be converted into a specified format upon request by authorities.
Timeline and Process
ESMA will publish a final report based on stakeholder feedback and submit the draft technical standards to the European Commission by June 30, 2024. Another consultation package is also expected to be published in Q1 2024.
Previous Consultation Paper
In July, ESMA released its first consultation paper on MiCA. It proposed that crypto companies registered under MiCA provide additional information through notifications to national competent authorities (NCAs).
Hot Take: ESMA Consultative Paper on MiCA
The ESMA has released its second consultative paper on Markets in Crypto-Assets (MiCA), seeking input from stakeholders on various aspects of MiCA regulation. The paper highlights the importance of sustainability indicators, post-trade transparency, and record-keeping for CASPs. By setting clear requirements and standards, the ESMA aims to establish a robust regulatory framework for the crypto industry. Stakeholders have an opportunity to provide feedback and shape the future of crypto regulation in the European Union. With further consultation packages planned, it is evident that the ESMA is committed to thorough research and collaboration with industry participants. The final report and technical standards will play a crucial role in ensuring transparency, accountability, and stability in the crypto market.
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