The Markets in Cryptoassets (MiCA), the EU’s comprehensive package of rules to regulate the nascent crypto sector, was adopted by the European Council on May 16. The legislation is expected to become law in 2024, putting the EU ahead of the other jurisdictions when it comes to regulating the cryptocurrency and digital asset industry.

EU Closer to Implement its First Crypto Regulatory Framework

On Tuesday, the European Council announced it had adopted MiCA – the bloc’s first comprehensive set of crypto-related regulations designed to address existing EU financial services legislation gaps. The move puts MiCA one step closer to becoming a law after getting approved by the European Parliament and European Union (EU) member nations.

The council’s decision comes roughly a month after EU lawmakers approved the MiCA regulation. At the time, European Financial Services Commissioner Mairead McGuinness said MiCA was expected to take effect in July after getting a formal green light from the bloc’s 27 member countries. Specific rules of the legislation, such as those governing stablecoins, are set to come into force in July 2024.

The final vote was initially scheduled for the end of 2022 but was delayed until April due to “technical issues.” This was the second time the final vote was postponed due to challenges around translating the 400-page legislation to the 24 official languages of the EU.

What Does MiCA Aim to Achieve?

The European Commission first put forward the MiCA proposal in September 2020 as a part of the bloc’s broader digital finance package aimed at promoting technological development in the region while establishing safeguards to ensure financial stability and consumer protection.

However, the EU reached a policy consensus on the legislation in October 2022, just a month before the crypto industry faced a massive setback amid the collapse of the FTX exchange. As mentioned earlier, MiCA represents the EU’s first-ever attempt to establish a comprehensive regulation for digital assets.

Once fully implemented, the regulation will require any crypto-related company in the EU to register in one of the member states. The registration process will be overseen by the European Banking Authority and the European Securities and Markets Authority, during which the regulators will ensure crypto firms adhere to the established rules and have proper risk management and governance processes in place.

Companies that register successfully can operate across the entire EU bloc. Many in the crypto world believe a unified EU-wide framework will make the EU more appealing to crypto companies and pressure other global jurisdictions to make similar efforts.

This article originally appeared on The Tokenist