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European retail investors will likely feel the biggest effect of the MiCA regulations through more stringent data collection and the potential introduction of crypto taxation laws.
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Europe’s Markets in Crypto-Assets Regulation (MiCA) is being hailed as a significant step forward for the cryptocurrency industry despite concerns about potential overregulation during its initial rollout.
MiCA is the world’s first comprehensive regulatory crypto framework, which went into full effect for crypto-asset service providers on Dec. 30.
While concerns regarding regulatory overreach persist, the regulation is expected to be a net positive for the cryptocurrency industry in the long term, according to Dmitrij Radin, the founder of Zekret and chief technology officer of Fideum, a regulatory and blockchain infrastructure firm focused on institutions.
“Long-term, [MiCA is] absolutely positive. Every regulation helps us to mature the market. It will drive more funds and more users,” Radin told Cointelegraph during an interview at Emergence Prague.
However, the regulation seeks to identify the “weak points of control” in the crypto space, which could mean more scrutiny for retail investors and the end-users of crypto platforms, Radin said.
Fideum’s Dima Radin, Interview with Cointelegraph’s Zoltan Vardai. Source: YouTube
Through his work with Fideum and the Crypto Economy Organisation, Radin spearheaded multiple governmental blockchain education efforts and has taken part in regulatory working sessions with lawmakers in Europe, he told Cointelegraph.
Related: Turkey introduces stricter crypto AML regulations
Increased scrutiny for retail investors
Initial implementation of MiCA may disproportionately impact retail investors, Radin said, as many users will face greater obligations to provide personal and financial data for compliance purposes:
“Retail users will be way more, obligated to provide information, data which will be screened. They will be accounted for. Most Europeans will see taxation.”
The regulation also raises the possibility of enforcement actions against blockchain protocols that fail to comply with MiCA standards. European governments may pursue legal cases against noncompliant platforms during the early implementation phase.
Related: Binance secures 21st global crypto license in Brazil
Some of the largest banks are already preparing their digital asset offering for the implementation of MiCA.
Societe Generale, the world’s 19th-largest banking group by assets, has partnered with Bitpanda to launch a MiCA-compliant stablecoin, the euro-denominated EUR CoinVertible (EURCV).
Crypto payment firm MoonPay also secured a MiCA approval in the Netherlands on Dec. 30.
Magazine: How crypto laws are changing across the world in 2025
This article first appeared at Cointelegraph.com News
