How will the German 🇩🇪 crypto market be regulated next year? MiCA 🗳️ and the consequences for investors 💸!

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What brings MiCA

The abbreviation MiCAR has often been used in connection with the crypto market. But what does it actually mean and what does European crypto regulation mean specifically for investors? The European Commission regulates the crypto market according to strict rules and is therefore considered a pioneer by many experts.

Germany already has special regulations in place, but these are being reinforced by the EU. From 2024, a lot will change for investors. We have researched in detail what that is in concrete terms.

  • The draft law comprises around 200 pages and applies to all 27 EU member states
  • MiCAR stands for Markets in Crypto Assets Regulation
  • Extensive set of rules with obligations for companies and providers
  • Legal certainty for crypto assets, cryptocurrencies, security tokens and stablecoins

Legal framework for the crypto market

While there has been regulatory chaos in the USA, the EU Commission is undertaking to streamline distributed ledger technology and virtual assets in the European Union with its framework. The first attempts were made in 2019 with advice papers by the European Financial Market Authority ESMA. During the research, it quickly turned out that there are no uniform financial instruments within the EU that regulate cryptocurrencies and digital assets.

The MiCAR now regulates very specifically how to deal with companies and investors in cryptocurrencies in Europe and what requirements there are for them. Utility tokens were still defined as crypto assets in the first versions of the draft law. In the meantime, however, it is clear that the framework conditions only relate to security tokens. NFTs are also not affected by MiCAR.

First of all, the EU defined which cryptocurrencies are regulated and how far the definition goes according to the European understanding. With the current understanding of crypto assets and the requirements regarding regulation or licenses, uniform regulation will be available from next year. But there is much more at stake. MiCAR has enormous advantages especially for providers, because once the permit has been obtained, it is valid in all 27 member states.

If you issue a new coin as part of an ICO, you not only have to provide the white paper for investors. You must submit the white paper to the regulatory authority for approval. Currently, providers have to comply with regulations and obtain licenses through a patchwork of different offers in the EU. With the MiCAR regulation, an easier process is then available for the crypto companies.

Limits of MiCAR: Just a regulation, not a guideline

Unfortunately, the MiCAR is only a regulation in the sense of a regulation and, unlike the European financial market directive MiFID, does not have to be implemented by the countries. MiCAR will be applicable from 2024, which means the second or third quarter of next year. The timeline is looking good so far, however, there are still formal stages to be completed. The MiCAR should be fully in force by the end of 2024.

However, there is an 18-month transition period. The providers concerned have 18 months to implement all the obligations arising from the MiCAR. In countries where cryptocurrencies and assets have so far been offered unregulated, experts see major hurdles in the implementation. The requirements for money laundering prevention are also fraught with difficulties in some countries.

Anyone who has already dealt with the conditions of a regulated crypto market will get along better with a slight upgrade to the conditions of the MiCAR. In Germany we already have obligations for crypto custody or regulations for affected crypto service providers. It will therefore be much easier for you to switch to MiCAR.

Key facts about MiCAR at a glance

  1. MiCAR is a regulation as part of the EU’s Digital Finance Package published on September 24, 2020.
  2. The EU framework is intended to create a uniform regulatory standard for all 27 member states.
  3. The objectives of MiCAR are also to combat money laundering and the financing of terrorism and to increase the protection of investors and consumers.
  4. With MiCAR, the EU also wants to strengthen the competitive conditions on the European crypto market and promote innovation.
  5. Providers of crypto exchanges, crypto brokers and platforms for exchanging crypto currencies are particularly affected. But also banks, financial institutions and securities institutions that want to offer trading in crypto assets. In addition, MiCAR also affects the advice and placement of crypto assets.
  6. MiCAR also includes specifications for white papers
  7. Providers must obtain approval from the responsible financial supervisory authority if they want to provide services with crypto assets.

The implications of MiCAR for the European crypto market

In addition to increased protection for investors, it is also about the major challenges associated with the introduction of MiCAR. On the one hand, the barriers to entry into the EU crypto market will be increased, on the other hand, these will strengthen user confidence in the long term.

However, the implementation of processes and organizational requirements increases the costs, which the customer will probably have to bear in the end.

However, the requirements contained in the MiCAR for honest, honest and professional action in the best interests of the customer cannot be implemented solely through the permission of BaFin and the white paper obligations. Market manipulation and abuse as well as insider trading require far-reaching regulations.

The template must first show whether MiCAR is sufficient. It should also be viewed critically that this is only a template that does not have to be implemented by the countries of the EU. The practical implementation of the MiCAR, from around 2025, will initially be characterized by the 18-month transition phase before the regulation, if implemented, was fully implemented in mid-2027.

For companies in Germany that already have a BaFin license, the MiCAR means they have to apply for a license again. Because the requirements of the previous regulation have nothing to do with the new specifications of the MiCAR.

These crypto pre-sales are not affected by MiCAR

According to the current state of knowledge, investors can continue to buy these crypto pre-sales tokens without having problems with the MiCAR later. Of course, this is primarily due to the fact that the MiCAR is not yet in force and many open questions or ambiguities have to be clarified before the regulation is issued as a recommendation to all member states.

Chimpzee stands for sustainability and species protection

The meme coin is a sign of the great changes in the market. Investors continue to look hard for meme coins and coins with a high entertainment value, but they are placing more and more value on a sustainable orientation.

Chimpzee offers 3x the chance of earning passive income and donates 10% of the tokens to charities that are dedicated to species protection or climate protection, for example. The first third of the presale is already sold out. Investors are currently buying the native utility token for just $0.00067.

Wall Street Memes publishes memes related to finance

A humorous and often sarcastic look at capitalism and its consequences, that’s how it is Wall Street memes best describe. More than 1.1 million followers are already enthusiastic about the project. The Meme Coin is currently available as a utility token in pre-sales for only $0.025. Early investors have already invested more than $11.1 million in the pre-sale.

yPredict offers intelligent prediction models for traders

On the yPredict platform AI developers can offer their own trading signal forecasting models for sale. This gives investors easy access to modern technology and processes to identify the ideal buy and sell signals in the market. The token is currently available in pre-sales for only $0.09. The token launch price will be $0.12.

Conclusion: Germany is already considered a pioneer in the regulation of the crypto market. With the European MiCAR regulation, there are even stricter requirements that companies must comply with in order to receive approval from the respective financial supervisory authority. However, investors are still benefiting from the high level of safety precautions.

All three crypto pre-sales have published a white paper, although the developers are not subject to MiCAR. This strengthens transparency and investor confidence in pre-sales. The high sums that have been raised so far and the quick sell-out of the phases show that the projects are popular.

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About the author: Stefanie Herrnberger works as a freelance speaker and editor. Her many years of professional experience in the areas of blockchain, cryptocurrencies and NFTs offer her the perfect background to report on current news and developments on decentralized and central financial markets. Stefanie has been investing in cryptocurrencies for several years. She understands the challenges and opportunities for crypto traders. Publications: https://de.cryptonews.com/editors/stefanie-herrnberger https://blockchain-technologie.digital/ https://www.facebook.com/groups/cryptonewsde/



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