European financial regulators are consulting on proposed standards for classifying certain cryptoassets under the region’s new crypto regulations.
The three European regulators — the European Banking Authority, the European Securities and Markets Authority and the European Insurance and Occupational Pensions Authority — have issued a joint consultation paper that sets out proposed guidance and templates for classifying cryptoassets under its new regime, known as the Markets in Crypto-assets Regulation (MiCA).
The paper also proposed a standardized test designed to produce a common approach to classification for asset-referenced tokens, and for tokens that aren’t backed by certain assets or pegged to a traditional currency.
The new MiCA rules are designed to regulate the issuance, public offering and trading of electronic money tokens, asset-referenced tokens and other crypto-assets, along with the provision of crypto services.
Those rules aim to “ensure the proper functioning of markets in cryptoassets, market integrity and financial stability in the EU, and to guarantee [a] high standard of protection for consumers and investors,” the regulators’ paper said.
To ensure these rules are applied consistently, the regulators’ draft guidance aims to establish classification standards.
“To facilitate convergence in the classification of crypto-assets, and therefore the consistent application of MiCAR, it is essential that market participants adopt a common approach to determine the status of a crypto-asset under MiCAR,” it said.
The proposals are out for comment until October 12, and the regulators are planning a virtual public hearing on the issues covered in the consultation paper on Sept. 23.