The entry into force of the MiCA (Markets in Crypto-Assets) and TFR (Transfer of Funds Regulation) regulations is getting closer following their adoption by the European Parliament. Blockchain industry players in the European Union will have to comply with a series of provisions as early as 2024.
It’s official, MiCA and TFR will soon come into force
The 2 key components to regulate the cryptocurrency ecosystem within the European Union, namely MiCA and TFRare coming to be adopted by the European Parliamentfollowing their approval by the Council of the European Union on 5 October.
The MiCA and TFR regulations must now pass through the hands of lawyers and linguists in order to be published in the Official Journal of the European Union. Once this is done, the various actors concerned by the provisions of the regulations will have between 12 and 18 months to comply (depending on their situation).
Thus, at the earliest MiCA is expected to come into effect in January 2024. For TFR, affected companies will have 18 months to comply with the Travel Rule.
But what do the MiCA and TFR regulations really change for our industry? Let’s come back together to the main repercussions that this will have on our ecosystem.
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The main provisions of MiCA
The MiCA (Markets in Crypto-Assets) regulation provides a large set of provisions to which Crypto Asset Service Provider (CASPs) – equivalent to the acronym PSAN in French – will have to comply.
Here is a non-exhaustive selection of what awaits the cryptocurrency market within the European Union:
- A European passport will see the light of day, allowing for example a company registered in France to be able to offer its services to customers from all the other countries of the European Union;
- the total prohibition for companies to remunerate their customers with the lending of stablecoins;
- the consideration of non-fungible tokens (NFTs) as financial assets (under certain conditions).
💡 Do you want to know more about what the MiCA regulation will change? Find our analysis of the latest measures added to this regulation
The main provisions of TFR
The main provision of the TFR (Transfer of Funds Regulation) concerns the Travel Rule. This rule refers to the fact that the companies concerned will have to share a lot of information about their customers when they make cryptocurrency transfers.
The Travel Rule was created with a view to combating money laundering and the financing of terrorism (LCB-FT). Thus, from mid-2024, all CASPs in the European Union will have to meet the requirements of the Travel Rule.
This rule will apply when a user makes a transfer in 2 CASPs, regardless of the amount senté, like 1 € in Bitcoin for example.
Concerning the information that the CASPs will have to transmit to each other, we find the first and last names of the user, the destination wallet, their account numbers on the platforms, their postal address, their identity number (identity card or passport ) or his date and place of birth.
💡 Further provisions are provided by the adoption of the Travel Rule for the cryptocurrency ecosystem. Here is our explanatory article on the subject
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Source : Live broadcast of the vote by the European Parliament
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Editor-in-chief of Cryptoast, I discovered Bitcoin and blockchain technology in 2017. Since then, I have been striving to share quality content so that the sector becomes more democratic for everyone.
Clement Wardzala
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