ESMA Proposes Tougher MiCA Rules for Crypto Marketing and DeFi Oversight
The European Securities and Markets Authority (ESMA) has proposed changes to the European Union's Markets in Crypto-Assets Regulation (MiCA) to improve investor protection and tighten supervision of crypto firms.
The regulator wants stricter rules for crypto marketing, especially when influencers and other third parties promote digital assets. ESMA also wants investors to receive clearer information before using crypto services, including details about fees, risks, possible rewards, collateral arrangements, and potential losses.
ESMA is also looking at crypto companies based outside the European Union, wanting stronger powers to deal with firms from third countries that target EU investors without having the required authorisation under MiCA. The regulator wants clearer rules for activities such as staking, lending, and borrowing, and wants users to receive enough information to understand what they are entering before making a decision.
The push for stronger supervision is another major part of ESMA's recommendations. The regulator wants the EU to have better tools to find, block, and shut down fraudulent crypto websites and freeze crypto assets in cases of suspected market abuse or terrorist financing.