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Enforcing Cryptography, Newsletter | Euronews
This week’s key events presented by senior financial reporter Jack Schickler.
Key diary dates
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Monday 24th – Tuesday 25th June: .7th European Nuclear Safety Conference.
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Thursday 27 – Friday 28 June: European summit of heads of state in Brussels to define the strategic agenda and the most important jobs of the EU.
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Sunday 30 June: The European law on cryptocurrencies comes into force.
ANNOUNCEMENT
In the spotlight
The EU’s landmark cryptocurrency law comes into force this week and it doesn’t look like everything will go smoothly.
The Crypto Asset Markets Regulation, MiCA, was finalized last year after years of negotiations and represents a world first.
MiCA tailors financial laws to apply to those who trade bitcoin and the like, offering a modicum of consumer protection in an industry prone to scams and manipulation.
But industry figures complain that the rules are still unclear after being finalized late. A few days after the rules came into force, we have not identified a single crypto player who has managed to be authorized under the provisions that will come into force next Sunday.
The toughest part of the law concerns stablecoins, cryptocurrencies that seek a fixed value compared to assets such as the dollar, and will apply starting from June 30th.
EU finance ministers were scared when Facebook announced its own stablecoin, Libra, in 2019. They didn’t want big US tech companies introducing their own currencies that could supplant the euro.
Their fears were largely confirmed in the spring of 2022, when another stablecoin, Terra, proved not to be as stable, sending a tsunami across the industry with a spectacular collapse.
Brussels has boasted that its new law will ensure people’s safety while promoting innovation, something the Union urgently needs to face competition from the United States and Asia.
But complying with banking-related laws was always going to be an uphill struggle for an industry that previously faced few regulatory constraints.
Cryptocurrencies have had a difficult few years, and many of their figures are now in prison on charges including fraud and money laundering.
Optimists hope that cryptocurrencies’ newfound regulatory credibility will put an end to these scandals, encouraging even the most cautious firms in the traditional financial sector to get on board.
If no one can comply, of course, regulation could simply kill the industry.
Political newsmakers
Hungarian Dutch in government
Zsolt Szabothe candidate for state secretary for digitalisation in the new right-wing Dutch government, he touted centralized AI as a priority of his term last week. Szabó, of Hungarian origins, was nominated by the far-right Freedom Party Geert Wilders, but today he told lawmakers that “IT is not left or right.” Like Szabó, incoming Minister of Economy Dirk Beljaarts he has a Hungarian mother. Beljaarts told Dutch media last week that he had given up his Hungarian passport. Szabó said he only has Dutch nationality. Wilders has criticized dual national politicians in the past.