Crypto influencers may be greatly impacted by the EU’s Markets in Crypto Assets (MiCA) law because several of its provisions appear to call for strict regulation.
Promoting and Profiting Covertly Will Be Illegal
Patrick Hansen, the director of EU strategy and policy at Circle, drew attention to this by stating that making comments about a digital asset and profiting from it covertly could be considered market manipulation.
Hansen shared the screenshot of the clause, which part of it reads:
“Taking advantage of occasional or regular access to the traditional or electronic media by voicing an opinion about a crypto-asset, while having previously taken positions on that crypto-asset, and profiting subsequently from the impact of the opinions voiced on the price of that crypto-asset, without having simultaneously disclosed that conflict of interest to the public in a proper and effective way.”
Although the clause is and open to several interpretations, the fact that it exists suggests that the EU may take enforcement action against people who promote cryptocurrency assets without revealing their interests.
The proposed law has drawn a range of responses from the public; some have praised it for its potential to stop peddling sh$&t coins while others have criticized it for leaving possibility for misuse in its implementation. Why it applies to cryptocurrencies but not to stocks or other financial markets was another point of contention.
Regulators from all around the world are becoming more aware of cryptocurrency influencers. Kim Kardashian was reportedly penalized $1.26 million by the U.S. SEC for her unauthorized advertising of EthereumMAX (EMAX).
Bill May Become Law In 2024
The MiCA measure isn’t expected to become law until 2024, though.
The regulators have asserted that the regulations guarantee consumer protection, but some of the cryptocurrency community have claimed that the regulations risk turning DeFi into yet another conventional banking institution.
The proposed bill is getting support from some EU parliament legislators. Dr. Stefan Berger, the EU’s MiCA Rapporteur, claimed that if Europe wanted to be a major player in the cryptocurrency industry, the legislation was essential.
According to Berger, the regulation would foster confidence between the industry and regulators while also fostering an environment that would encourage business innovation. Due to the open and permissionless nature of the technology, a member of the European Parliament named Lidia Pereira suggested using blockchain technology to fight tax evasion and even money laundering. The bill would therefore help in regulating against these vices.
Image Courtesy of Shutterstock
