EU officials are touting a new crypto framework, the Markets in Crypto Assets (MiCA) law, that they say offers greater clarity to blockchain innovators. This approach of regulate first and then see how the market responds could give Europe an edge over the US, where the Securities and Exchange Commission (SEC) is engaging in regulation by enforcement rather than setting out clear rules.
What we hear from businesses is that now a lot of them are looking to grow, to stay safe, and to manage their risks, said Joachim Schwerin, a principal economist in the European Commission’s department responsible for economic growth. They don’t know what will happen in the US, so they come to us. This is good for us, this is good for competitiveness.
Lawmaker Ondřej Kovařík, the main negotiator of MiCA on behalf of the economically liberal Renew Europe party, believes this rules out the kind of uncertain enforcement seen in the US. We don’t have this approach here, he said, adding that the recent SEC moves can be an opportunity for Europe.
Regulatory agencies are due to set out how the rules will work over the coming 12-18 months. If it’s not applied successfully, then the trend can actually very easily be overturned, Kovařík said.
In France, regulators have said fleeing US companies are welcome, while influential US lawmaker Patrick McHenry (R–N.C.) has said Europe’s relative success in legislating for crypto should send chills up the spines of Americans because of the likely boost to innovation.