Welcome to the latest issue of the Veriscope Regulatory Recap. In this edition, we explore recent regulatory developments in the European Union and Turkey, examining their potential impacts on the crypto industry.
The implementation of the Markets in Crypto-assets Regulations (MiCA) will occur gradually in the European Union. For example, the stablecoin-related regulations have been in effect since June 30. Additional regulations impacting crypto asset service providers (CASPs) will follow in December this year.
One immediate effect of MiCA is the psychological shift it brings, dispelling doubts about the legitimacy of crypto businesses within the EU. After all, the regulations eliminate uncertainties regarding the future of crypto in Europe.
On the downside, MiCA also introduces market disruptions. Take Stablecoins, for example. They now must comply with stringent new requirements, which may lead to delisting non-compliant stablecoins from EU-based exchanges. Already, Uphold has delisted six stablecoins, including Tether USDT, the most dominant stablecoin globally.
Such moves might push issuers to exit the EU market altogether or transition towards euro-backed stablecoins.
Turkey passed a major crypto bill in the Turkish Grand National Assembly on June 27, 2024. This new law increases oversight of digital assets with strict penalties for non-compliance.
The bill gives control of crypto oversight to Turkey’s financial watchdog, the Capital Markets Board, which will also license digital asset exchanges. Crypto service providers must ensure that customer fund transfers are accessible and traceable by law enforcement.
Platforms that break these rules will face fines from $7,500 to $182,600 and prison terms of up to five years. The Capital Markets Board can also approve audit firms for digital asset companies and temporarily shut down non-compliant platforms.
President Recep Tayyip Erdoğan is expected to approve the bill soon. Once approved, it will be published in the Official Gazette or returned to parliament for further review.
The EU's MiCA regulations aim to bring clarity and stability, which could attract more investors. Turkey's strict rules and penalties, on the other hand, are intended to build trust and transparency in the sector.
As both regions update their rules, the global crypto market is watching closely. It's important for everyone in the crypto industry to stay informed and adapt to these changes.
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