EU Faces Challenges in Implementing MiCA Regulations

According to PANews, the European Union's Markets in Crypto-Assets Regulation (MiCA) has been in effect for less than a year, yet several issues have already emerged. Regulatory bodies are working to prevent these problems from worsening. Concerns have been raised about the rapid pace at which licenses are being issued by some member states. The European Securities and Markets Authority (ESMA) plans to adopt more centralized and stringent regulatory measures for cryptocurrencies within its jurisdiction, although specific details of these plans remain unclear. One potential change involves the sharing of liquidity and the use of a unified order book with regions outside the EU. From a regulatory perspective, a shared order book could obscure responsibilities related to trade matching, information disclosure, risk management, and best execution. However, traders see the aggregation of buy and sell orders across a broader audience as a way to create greater liquidity, facilitate easier trading, and achieve more accurate pricing. ESMA has not provided a specific response regarding the shared order book issue. However, in an email, it reiterated its earlier stance from a Q&A session earlier this year, stating that MiCA does not permit cryptocurrency trading companies to merge their order books with any non-EU, non-MiCA regulated trading platforms. This position aims to ensure a level playing field for MiCA's application within the EU, and ESMA is committed to maintaining this effort.