Cryptocurrencies

Italy set to strengthen surveillance of cryptocurrency markets as part of

Italy is set to step up its monitoring of cryptocurrency markets as part of its compliance with the European Union’s Regulatory Framework for Crypto Asset Markets (MiCA).

Under the new regulations, Italy will strengthen supervision of digital asset markets to limit and punish insider trading and market manipulation schemes.

The decree provides for fines ranging from 5,000 to 5 million euros ($5,400 to $5.4 million) depending on the severity and scale of regulatory infractions.

Implications of the MiCA regulatory framework

The European Union’s MiCA regulatory framework was first adopted in 2022, forcing blockchain companies to make tough decisions, while decentralized finance (DeFi) protocols face the difficult choice of whether to completely decentralize their networks or to submit to the anti-money laundering framework. awareness. Your customer lists.

Section I of the EU regulatory framework MiCA. Source: European Union

Fully decentralized networks are exempt from MiCA reporting requirements. However, due to the reliance on institutions and other intermediaries that help moderate decentralized communities, these protocols risk violating the MiCA definition of a sufficiently decentralized network.

This means that these DeFi protocols must either be fully decentralized or accept a situation where users must provide verification data – which is difficult for many network participants.

about: MiCA regulations are shaped by the latest EBA guidelines

Central exchange Binance recently informed its European customers that it is moving towards a model that classifies stablecoins as permissioned or permissionless, in accordance with the MiCA framework, and that it is gradually transitioning users to the new system over time. time.

Richard Teng, CEO of the exchange giant, also noted that Binance is not removing these stablecoins from spot markets, but only limiting their availability to European users for certain products.

Uphold also made changes to remain compliant with EU regulatory reform and announced the delisting of six stablecoins, including Tether (USDT), Frax Protocol (FRAX), Pax Dollar (USDP), Dai (DAI), and TrueUSD (TUSD and Gemini). . Dollar (US Dollar).

Stablecoins: a cash saver?

Despite growing regulatory pressures in Europe, many experts believe stablecoins have a promising future and could prevent debt crises caused by excessive printing of fiat currencies. Former Speaker of the US House of Representatives Paul Ryan recently explained that stablecoins could help alleviate shortages in the US economy caused by the debt-laden US dollar.

Jeremy Allaire, CEO of stablecoin issuer Circle, also expressed optimism about the future of stablecoins, stating his belief that stablecoins will represent 10% of the money supply over the next decade.

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