A recent Reuters report has indicated that Gemini and Coinbase are nearing regulatory approvals that would permit them to operate across the European Union under MiCA.
Gemini’s Application Status
Gemini’s application for approval is reportedly making progress through Malta. In contrast, Coinbase is pursuing authorization in Luxembourg. While Coinbase hasn’t provided specific details about its licensing efforts, company representatives have noted that Luxembourg is a globally recognized financial jurisdiction.
The Impact of MiCA and Stablecoins
MiCA, effective as of June 2024, aims to harmonize crypto regulation across EU member states. The framework is designed to offer clarity for companies operating in the sector and support investor protection and market stability.
Full enforcement will be implemented by December 2024 after final guidelines are issued by the European Securities and Markets Authority (ESMA).
Several firms have already secured approval under MiCA’s early adoption phase. Bybit was recently authorized to operate in the EU through Austria, and Binance has adjusted its services in Poland to align with MiCA requirements.
The regulation has also impacted stablecoins significantly. While some view the rules as a step toward clearer oversight, others highlight areas that remain ambiguous. Chainalysis noted that the regulatory text leaves certain aspects open to interpretation, particularly concerning stablecoin issuance.
One key provision under MiCA mandates that issuers of stablecoins must maintain a significant portion of their reserves with European financial institutions. This condition has led some issuers, such as Tether, to opt out of seeking registration within the EU.
Despite these challenges, over ten stablecoins have already received approval under the framework. These include offerings from Circle, Crypto.com, Fiat Republic, and Société Générale. However, adoption appears limited in some markets; for instance, officials at the Bank of Italy have stated that the regulation hasn’t yet driven significant uptake of stablecoins in Italy. Instead, market demand seems to favor custodial services and crypto trading infrastructure.
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