After FTX’s liquidity problems and news of Binance’s acquisition, European regulators and experts took action and commented that the union’s new digital asset legislation will mitigate such market turmoil in the future.
“The European Union’s New Cryptocurrency Laws Will Prevent Such Situations From Happening”
“The crypto industry is not a casino,” said Stefan Berger, a member of the European Parliament and one of the chief negotiators of the Crypto Asset Markets (MiCA) legislation, which is expected to pass through Parliament early next year. “MiCA is a bulwark against Lehman Brothers events like the FTX case,” he added via email.
Berger also pointed out that MiCA includes provisions to separate the assets of customers and funds, implement internal control mechanisms and provide transparency to customers.
“Just like banks, crypto-asset service providers need mechanisms that enable risk management,” Berger continued.
bitcoin The drama that followed after FTX CEO Sam Bankman-Fried shocked the crypto industry by announcing that the exchange’s non-US assets would be sold to Binance, led to the crash of many cryptocurrencies amid a volatile market.
“Regulatory Agencies Will Learn From These Events”
“This is very bad for the industry,” said Dimitris Psarrakis, a former European Parliament policy expert and currently a consultant on various crypto legislation at EU institutions. Psarrakis added: “I am confident that this event has been extremely informative for regulatory authorities.”
The European Union is on the verge of enacting comprehensive legislation on crypto assets and service providers, and new laws are expected to come into effect in 2024. Until then, financial regulators need to determine the details of how the regulation will be implemented.
The European Securities and Markets Authority will be the main body responsible for setting the rules for crypto-asset service providers.
According to Robert Kopitsch, director of a Brussels-based crypto lobby group, there is a benefit to buying FTX:
“From a political perspective, it’s always positive that mergers provide greater consumer protection, better services and more security. That would be the ideal result.”
*Not investment advice.
For exclusive news, analytics and on-chain data Telegram our group, twitter our account and YouTube Follow our channel now! Moreover Android and iOS Start live price tracking right now by downloading our apps!