Crypto-assets under MiCAR: a deep dive into risks, solutions, and regulatory convergence

The article discusses the evolution and challenges posed by crypto-assets, particularly focusing on the European Union's response through the Markets in Crypto-Assets Regulation (MiCAR). It begins with the increased attention on crypto-assets following Facebook's Libra proposal and the subsequent recognition of potential risks by regulatory bodies. The MiCAR framework addresses various aspects, including consumer protection, financial stability, market integrity, and the risks of market fragmentation. Notable measures include mandatory disclosure through crypto-asset white papers, the introduction of withdrawal and redemption rights, and regulatory oversight for issuers to ensure stability.

The article emphasizes the need for a harmonized regulatory approach within the EU, addressing the previous regulatory gap that resulted in market fragmentation. It concludes by highlighting the significance of MiCAR in the EU's efforts to manage the complex challenges posed by crypto-assets, while also underscoring the necessity for a global approach and evolving risk management practices in the dynamic crypto landscape.