European regulator publishes second consultation on MiCA

On October 5, the European Securities and Markets Authority (ESMA), the regulatory body overseeing financial markets in the European Union, unveiled its second consultative paper on Markets in Crypto-Assets (MiCA) mandates. This comprehensive 307-page document delves into crucial aspects of MiCA, soliciting input from stakeholders on five key areas.

One pivotal area under scrutiny is sustainability indicators for distributed ledgers. ESMA is keen on quantifying metrics related to energy consumption, greenhouse gas emissions, and waste production. Additionally, the document emphasizes the qualitative impact assessment of blockchain network nodes on natural resources.

Another focus of the consultation involves post-trade transparency. ESMA proposes that Crypto-Asset Service Providers (CASPs) should report vital trading details, including dates, identification of crypto-assets, pricing information, quantity, execution venue, and transaction ID. Notably, CASPs are encouraged to store transaction data in a format of their choice, with the flexibility to convert it to a specified format if required by regulatory authorities.

ESMA’s plan involves incorporating feedback from stakeholders to create a final report. This report, along with draft technical standards, will be submitted to the European Commission by June 30, 2024. However, prior to this submission, ESMA intends to release a third consultation package in the first quarter of 2024.

This recent consultation follows ESMA’s earlier release in July, where the regulatory body proposed that crypto companies registered under MiCA provide additional information through notifications to national competent authorities (NCAs) in their respective countries. As the regulatory landscape evolves, these consultations mark significant steps toward shaping the future of crypto-assets within the European Union.

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