MiCA set out to unify crypto rules across the EU.

USDC becomes the first stablecoin under the MiCA framework.

Experts talk about the impact of the decision on crypto in the EU.  With the pieces of the European Union’s comprehensive Markets in Crypto Assets (MiCA) framework falling into place, experts are making their initial assessments. While skepticism prevails, crypto exchanges are now embracing unified rules across the EU. One of them is Bybit, which recently applauded the approval of Circle’s USDC stablecoin under EU’s MiCA rules. The Exchange believes that the new unified environment across all EU member states will make operations for crypto businesses much simpler and catalyze the growth of the industry. Bybit Sees USDC’s Approval Under MiCA as a CatalystFor international crypto exchanges, regulatory compliance across different jurisdictions is a major risk factor. However, Eugene Cheung, Head of Institutional at Bybit, explained in a press release on Tuesday, June 16, that since the introduction of MiCA, things have looked up for the large EU market.  Sponsored So far, crypto businesses in Europe have had to ask for separate approvals in each country. Now, under MiCA, they only have to ask for approval in one country, as seen in the recent USDC approval. According to Cheung, this makes it much easier for crypto businesses to operate in the large European market. “MiCA represents a significant step towards a more institutionalized European crypto market, fostering trust and transparency for investors. This unified regulatory framework will pave the way for a more robust and thriving crypto ecosystem across the entire European Union," Cheung explained. In addition to making it easier for businesses to operate, the rules will also create a more secure environment for both institutional and retail investors, explains Cheung. This will boost trust, which is why Bybit is optimistic about crypto in Europe. USDC Approval Eases Concerns Over MiCAEU’s MiCA framework was initially met with skepticism, with critics seeing it as too restrictive, especially for stablecoins. However, when the EU approved Circle as a stablecoin issuer on July 1, industry insiders were somewhat relieved.  Sponsored USDC’s legality in the EU is unquestioned, as it gained approval under MiCA thanks to an Electronic Money Institution (EMI) license from France. The move significantly reduced the stablecoin issuer’s regulatory risk, which it still faces in other jurisdictions, including the US. MiCA, which took effect in June 2023, is the EU’s first comprehensive legal framework for cryptocurrencies. It requires all crypto businesses to register with a member state entity and introduces strict rules for stablecoins. For instance, issuers must maintain adequate reserves, ensure redemption rights, and comply with stringent transparency and reporting obligations. On the Flipside While USDC gained approval, Tether, the largest stablecoin globally, is facing significant issues. Several exchanges already delisted Tether in the EU when MiCA took effect. 

MiCA’s strict stablecoin rules are seen as a response to the collapse of the algorithmic stablecoin pair Terra-Luna.  Why This MattersBybit points out that MiCA offers regulatory clarity across the large EU market to crypto businesses and investors. This has the potential to drive more innovation while also protecting investors. Read more about MiCA regulations in the EU: EU’s MiCA Crypto Regulations: What You Need To KnowRead more about the LI.FI hack and how to stay safe: LI.FI Hack Steals $10M From Users: How to Protect Your Funds