ESMA Seeks Feedback on MiCA Guidelines

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By BitcoinWiki News

Key Takeaways:

– ESMA, the top regulator of the European Union’s financial markets, has opened a feedback window on guidelines under MiCA regulation
– MiCA is EU’s comprehensive crypto law due to take effect this year
– ESMA has launched two consultation papers on reverse solicitation and classification of cryptos as financial instruments
– Inputs from stakeholders on these MiCA guidelines are sought by 29 April 2024
– ESMA’s first consultation paper seeks more guidance on the conditions of application of the reverse solicitation exemption
– Article 61 of MiCA, often referred to as the reverse solicitation exemption, is actually a restriction that prohibits third-country firms to solicit clients in the EU
– The second consultation paper includes questions on the scope of the conditions for the qualification of crypto-assets as financial instruments
– ESMA’s aim is to create a structured yet flexible crypto law and reduce misunderstandings and misinterpretations of policy intent


Title: ESMA Opens Feedback Window on MiCA Guidelines

Introduction
The European Securities and Markets Authority (ESMA) has opened a feedback window on guidelines under the Markets in Crypto Assets Regulation (MiCA) regulation, which is set to take effect this year. The MiCA regulation is the EU’s comprehensive crypto law that promises legal certainty, compliance challenges, and global implications.

Consultation Papers
ESMA has launched two consultation papers – reverse solicitation and classification of cryptos as financial instruments. The regulator is seeking inputs from stakeholders on these MiCA guidelines, which aim to create structured yet flexible crypto laws.

Reverse Solicitation Exemption
ESMA’s first consultation paper aims to receive more guidance on the conditions of application of the reverse solicitation exemption. It also seeks inputs on the supervision practices that national competent authorities may take to prevent its circumvention. The proposal seeks public opinion on potential loopholes that could be exploited by third-country firms to circumvent MiCA authorisation requirements.

Scope of the Conditions for Qualification of Crypto-Assets
The second consultation paper includes questions on the scope of the conditions for the qualification of crypto-assets as financial instruments. ESMA seeks to reduce misunderstandings and misinterpretations of policy intent and support a harmonized approach throughout the Union.

Conclusion
ESMA’s consultations papers reflect the regulator’s broader work in establishing regulatory clarity around cryptocurrencies in line with the MiCA regulations. The regulator is inviting all interested stakeholders to respond to the consultation papers by April 29, 2024. These consultations aim to gather feedback from crypto-asset service providers, financial entities dealing with crypto-assets, and all stakeholders with an interest in crypto assets. Overall, ESMA’s goal is to create a structured yet flexible regulatory framework for cryptocurrencies under the MiCA regulations.

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