Regulation
Balancing Crypto Innovation and MiCA Regulatory Compliance
The Markets in Crypto Assets (MiCA) Regulation marks an important turning point for the crypto industry in the European Union (EU). As these new regulations come into effect, crypto companies are ready to meet both challenges and opportunities.
In an exclusive interview with BeInCrypto, Ilya Volkov, CEO of crypto platform YouHodler, shared his views on how MiCA will shape the future of crypto-financial services.
Impact on crypto growth, innovation and consumer trust
MiCA is the first explicit regulation for crypto assets in the EU, providing legal clarity for stakeholders. He categorized digital assets, specifies the applicable regulations and designates responsibility for their application.
This regulation addresses regulatory issues, ensuring a level playing field for crypto institutions in the EU and eliminating regulatory fragmentation between member states. Additionally, it protects investors, prevents fraud and ensures compliance with anti-money laundering (AML) and financial laws. Volkov sees MiCA as a revolutionary step in creating a consistent regulatory environment for crypto assets across the EU.
Learn more: What are Markets in Crypto Assets (MiCA)?
“The main benefit is that MiCA represents a significant step forward in addressing the long-standing disconnect between global operations and local regulations,” he said.
He emphasized that financial markets, including crypto, operate globally but are subject to local regulation. This inconsistency has always posed significant obstacles for international Web3 companies and individual customers.
“For companies like Youhodler, regulatory frameworks like this will significantly facilitate access to international markets. In the case of MiCA, this allows companies to reach all EU member states without submitting repetitive license applications in each country,” he added.
Additionally, MiCA’s comprehensive requirements and guidelines aimed at improving consumer protection can foster a more transparent and trusted crypto market. Volkov believes that transparency is crucial to building consumer trust.
“Protected by MiCA, consumers can now know if their digital wealth is in the hands of a legitimate service provider. This peace of mind is very beneficial for individuals and for the mass adoption of crypto,” he said.
The regulations also address environmental concerns associated with crypto operations. YouHodler has proactively aligned its operations with sustainable practices, with its research and development team working to update the company’s technology infrastructure to save energy and reduce environmental impact.
MiCA’s regulatory framework also provides unique opportunities for companies like YouHodler to stay ahead in the competitive crypto market. By speeding up the licensing process, MiCA facilitates the expansion of YouHodler’s presence in the EU.
Volkov acknowledged the hard work required to upgrade the platform to compliance, but stressed that the additional layers of regulation and protection will help the company stand out by filtering out unqualified players, such as offshore companies. non-compliant targeting EU customers.
Balancing the pros and cons of MiCA
Despite the clarity, adapting to MiCA’s requirements presents unique challenges. For example, providing yield products on stablecoins has been a common practice for crypto asset service providers (CASPs) and exchanges over the past five years. However, companies serving EU customers will no longer be able to do so due to the initial phase of MiCAwhich concerns stable coins.
Recent reports also indicate that several crypto exchanges, including Binance, are delisting certain crypto assets to comply with MiCA regulations. Volkov highlighted the need for YouHodler and other Web3 platforms to migrate from non-compliant stablecoins to those meeting MiCA standards. Currently he sees USDC, the most compliant dollar-backed stablecoinbut Volkov foresees the emergence of more compliant options soon.
“Our team is working diligently to update our products and services to ensure full compliance and timely support for customers looking to convert their digital assets,” Volkov asserted.
Additionally, the current version of MiCA does not yet cover decentralized finance (Challenge) adequately. However, Volkov is confident that future updates will address this innovative and active part of the crypto ecosystem.
Nonetheless, the global implications of MiCA cannot be overstated. Volkov believes that MiCA establishes a precedent for international crypto regulationserving as a model for other regions.
Learn more: Crypto regulation: what are the advantages and disadvantages?
“Countries in Latin America and Asia will adopt similar approaches in the near future. Speaking of which, we are also preparing for the LATAM market. We submitted our application in Argentina,” he told BeInCrypto.
As the industry prepares for possible market turbulence in the first year of MiCA implementation, Volkov remains optimistic about long-term sustainable growth. He believes that MiCA represents a significant step forward, sparking a sense of preparation and anticipation for the future of crypto.
Disclaimer
Following the Trust Project guidelines, this feature article presents the opinions and perspectives of industry experts or individuals. BeInCrypto is dedicated to transparent reporting, but the views expressed in this article do not necessarily reflect those of BeInCrypto or its staff. Readers should verify the information independently and consult a professional before making any decisions based on this content. Please note that our Terms and conditions, Privacy PolicyAnd Disclaimer have been updated.