The EU is putting far -reaching rules for the crypto industry of the Wild West

Europe has reached a pioneering agreement to regulate the trade in crypto assets in the block to contain what the legislator calls the "wild west" of the financial markets.

The EU member states and the European Parliament defined the conditions of the rules late Thursday, which aim to protect consumers and at the same time flourish the resulting market.

The rules, known as regulation on markets in crypto-assets (mica), are the first attempt to enforce standards throughout the block, and not a patchwork of national regulations.

After a heavy market crash, the prices of tokens such as Bitcoin and Ether, which has a heavy blow. Since November last year, the value of popular crypto tokens has fallen by more than 70 percent, and the size of the market itself has fallen to less than $ 1 trillion by two thirds.

"The latest developments in this fast-developing sector have confirmed the urgent need for EU-wide regulation," said Bruno Le Maire, French finance minister.

The standards mean that a crypto-asset service provider requires approval from one of the EU's national market regulators so that it can pass its services through the block. Local regulatory authorities will exchange information with the pan -European regulatory authority ESMA.

"We will have a new crypto sheriff in the EU," said Spanish MEP Ernest Urtasun. The union moved "from the Wild West of the unregulated and risky digital assets into a safer crypto sphere," he added.

regulated companies are not only confronted with stricter standards for the protection of consumers, but are also liable in the event that they lose investor money. The industry, which is often criticized for its considerable CO2 footprint, must also disclose information about its environmental impacts.

StableCoin issuers must be present within the EU and have a “sufficient liquid reserve”. They are monitored by the European banking supervisory authority. A stable coin is a kind of cryptocurrency bound to assets such as the US dollar and acts as a bridge between the existing financial markets and the crypto world.

not fungible tokens, digital tokens that represent unique works such as works of art were excluded from the rules, unless they fall under existing categories of crypto-assets. The European Commission will re -evaluate the proposals in the next 18 months.

"This will bring regulatory security, reduce fragmentation and underpin the development of a robust and well -functioning market," said James Kemp, Managing Director at Afme, a lobby group for investment banks. However, he added that the legislature had to clarify a few points, for example the legal requirements for the custody of crypto-assets.

The groundbreaking regulation comes a day after the authorities have agreed on the transfer of funds regulation (TofR), the crypto players impose new compliance standards to act against money laundering risks in the industry.

Valeria Cusseddu, political consultant in the European Parliament Committee and currency, said that crypto companies under Tofr also have to "adopt internal guidelines and procedures in order to comply with targeted financial sanctions".

"The crypto sphere is full of risks and open to abuse and attacks. We want to ensure that investors have guarantees for the protection of their assets and their privacy, and we avoid cases such as the latest crypto crash, in which small investors lose their entire money because of poorly designed products or fraud," added Urtasun.