Happy EU year — The crypto laws coming from Brussels in 2024

Brussels: In 2024, the EU’s financial watchdogs will publish their final set of consultations to fill in the remaining details of the Markets in Crypto Assets regulation before it goes live.

This first phase of MiCA will kick in from June, when rules addressing stablecoin issuers go live.

Stablecoin issuers will have new prudential, liquidity, and disclosure requirements. They must also publish a whitepaper for each crypto asset available for trade on exchanges.

The second phase of implementation follows six months later, and deals with the licensing of crypto asset service providers.

That means firms must comply with rules on capital requirements, internal controls, and governance — unless their home countries choose to extend the transitional period to mid-2026.

The Transfer of Funds Regulation, aimed at tackling anti-money laundering, will be enforced at the same time.

MiCA doesn’t include rules for DeFi, but the regulation compels the European Commission to publish a report assessing DeFi markets. That could be followed by a legislative proposal.

The report is due 18 months after MiCA came into force in June, so we can expect a report by the end of 2024.

With a push from the Belgian digital minister, the European Commission is due to launch a new political body — the European Digital Infrastructure Consortium.

The consortium will roll out a European Union-wide blockchain to revamp public infrastructure.

EU lawmakers weren’t able to finish negotiating a bill on anti-money laundering in 2023. So now we look to 2024.

The bill covers decentralised autonomous organisations, non-fungible token platforms, and decentralised finance platforms. There are also restrictions on self-hosted wallets.

Negotiations are set to begin again, and could wrap up in January.

The European Parliament has passed a landmark Data Act critics fear could drive DeFi developers out of the continent.

Lawmakers in the European Parliament are working through several digital finance bills.

These bills set controls on how customers and companies handle financial data, and draft rules for payment services.

Stablecoin issuers and some crypto asset service providers are included. Legislation on the controversial digital euro is also still on the table.

The Digital Operational Resilience Act comes into effect after MiCA goes live at the end of 2024.

DORA will force crypto service providers to regularly report to regulators, and prove they can manage technology risks.