A series of regulations included in a European legal framework on cryptocurrencies came into force on December 30. The interventions aim to inform investors in the crypto asset market about potential risks, ensure the stability of the existing monetary network and explore prospects in this area.
The new regulations, integrated into the Markets in Crypto Assets (MiCA) of the European Securities and Markets Authority (ESMA), will affect three categories:
Electronic money tokens
Crypto assets specifically designed to stabilize their value by being directly linked to a single official currency are classified as “electronic money tokens”. These assets aim to provide predictable value tied to a fiat currency, such as the euro or dollar, making them a popular choice for users seeking minimal volatility in the cryptocurrency space.
Asset Referenced Tokens
These crypto assets stabilize their value by tying it to another value, right, or combination of such references. This category often includes a mixture of one or more official currencies and other assets. Known as “asset-referenced tokens,” they provide a broader basis for value stabilization and may be of interest to users looking for diversified underlying supports.
Other Crypto Assets
This group includes all crypto assets that do not fall into the categories of e-money tokens or asset-referenced tokens. These assets are not tied to specific stabilization mechanisms and can serve a variety of purposes, such as speculative investments, utility functions, or decentralized financial applications.
The new MiCA (Markets in Crypto-Assets Regulator) regulation highlights that investing in cryptocurrencies remains inherently risky due to the high price volatility that these assets can experience. The European Securities and Markets Authority (ESMA) also highlighted that, despite the new measures introduced by MiCA, the level of investor protection is lower than that of traditional investment products.
Beyond the MiCA provisions already in force, the Greek government is proposing additional measures to protect investors in cryptocurrencies through a bill aimed at strengthening capital markets. Presented to Cabinet on Friday, the bill includes:
Designation of supervisory authorities: Depending on the case, regulatory oversight of cryptocurrencies will be entrusted to either the Hellenic Capital Market Commission or the Bank of Greece.
Penal provisions: The bill introduces penalties for illegal activities related to cryptocurrencies.
Future tax framework: as previously announced, a specific legal framework to tax cryptocurrencies as investment products will be implemented by 2025.
These measures reflect the government’s efforts to improve the regulatory landscape and investor protections while addressing emerging challenges in the rapidly evolving cryptocurrency sector.
