An Analysis of the MiCA Regulation and Its Impact for the Blockchain-Based Economies

Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets, also known as MiCA, aims to introduce a comprehensive and harmonized regulatory framework for crypto-assets, including cryptocurrencies, security tokens and stablecoins, in the European Union. This paper provides a short overview of the evolution of cryptocurrency regulation at an European and international level, in order to provide the necessary context for understanding the current state of regulation in the field. The main objective of this research is an analysis of the MiCA regulation and its impact on the cryptocurrency financial industry, with an emphasis on studying the effects on innovation in the field, on consumer protection as well as on the decentralized sector. The paper also addresses the challenges in the case of MiCA implementation, as the need for coordination and cooperation between different authorities or the risk of “regulatory arbitration”. This incursion into the future legislative framework of cryptocurrencies at the European level creates the necessary ground for future strategic discussions, both at the European and international level, with a particular interest for the emerging sector of decentralized finance.