Some EU lawmakers are uncertain if the bloc’s upcoming Markets in Crypto Assets (MiCA) rules are tough enough to stem wider structural problems in the industry. jackschickler reports from Brussels.
would have stopped FTX-style mismanagement, officials said on Wednesday – despite lawmaker skepticism over whether the new rules are effective.
“Under the MiCA regime, no company providing crypto assets in the EU would have been allowed to be organized, or perhaps I should say disorganized, in the way FTX reportedly was,” Alexandra Jour-Schroeder, Deputy Director General at the European Commission’s financial services arm told lawmakers at a specially convened hearing on Wednesday.
Around 10% of its customers were in the EU, and one subsidiary, FTX Europe Ltd., was until early November supervised by the Cypriot financial regulator. “I’d like the commission to wake up a bit,” Lalucq added. “Can we really hold our heads up high and say that Binance, for example, which is registered in Europe… couldn’t possibly go bankrupt?”
“I wouldn’t comment on individual cases, but generally speaking the [crypto] industry has many signs of weaknesses across all key functions,” said Steffen Kern, head of ESMA’s risk analysis and economics department, citing poor management and failures to segregate client funds. “MiCA, had it been in place, would have been extremely helpful.”
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