Mairead McGuinness, the European commissioner for financial services, encouraged the European Union’s lawmakers to find a political compromise and speed up passage of its crypto asset regulatory framework, currently in the last leg of the bloc’s legislative process.
If in place, the Markets in Crypto Assets (MiCA) framework could facilitate the implementation of sanctions against Russia, which also apply to crypto, McGuinness said during her opening remarks at the economics committee Structured Dialogue on Tuesday.
“Of course, sanctions implementation could be facilitated if our framework on crypto was in place, and if all crypto asset service providers were regulated entities and subject to effective supervision in the European Union,” McGuinness said.
McGuinness cited three recent events as reasons for hastening the legislation: the war in Ukraine, the crash of cryptocurrency issuer Terra, and the news that crypto lender Celsius was suspending withdrawals.
“What I want and what I can tell you is that MiCA rules will be the right tool to address the concerns on consumer protection, market integrity, and financial stability. This is something that is so urgent given recent developments,” McGuinness said.
The MiCA framework seeks to regulate the digital asset space at the EU level, setting up licensing requirements for crypto asset service providers and cryptocurrency issuers that would apply for all 27 member nations. Introduced in 2020, the framework has been moving through the EU’s complex legislative process, and not without some contention over the environmental impact of cryptocurrencies and privacy.
The war in Ukraine and the implementation of strict financial sanctions on Russia have led to concerns over the use of cryptocurrencies to evade sanctions. EU leaders have been calling for the expedition of MiCA, arguing it would help fight sanction evasion.
On Tuesday, EU lawmakers are meeting in Brussels to discuss the framework in one of the last trilogue sessions before the rules are finalized. Lawmakers could reach an agreement on the file by the end of the month.