The European equivalent of the US SEC, ESMA (European Securities and Markets Authority), has sent shockwaves through the industry with its recent MiCA law. This newly introduced law is set to change the landscape of digital assets in the coming months.
Sources suggest that global crypto assets make up only 1% of global assets, so it cannot be called a niche landscape. This 1% is close to €3 trillion, so it is safe to say that the market has begun weighing in.
Speculation suggests that this weigh-in rate will supposedly increase over time as the interrelationship between crypto and other assets grows deeper. Digital assets will eventually become a viable means of payment.
Is MiCA Worth It?
The landscape widely adopted MiCA regulations as people believed that they would work like armor. On paper, the regulation supposedly protects users with different layers of protection, which made people believe that MiCA might just be the next big thing.
However, analysts claim that MiCA is less efficient than the US-backed Stable Act. Therefore, investors are growing concerned about how states receive the law. In fact, in a social media post, ESMA officials stated, “There is a real risk for investors of losing most, if not all, of their investment.”
This has certainly left people on edge. If things continue as they are, the fear/greed index might go haywire, and there could be another unprecedented liquidation event.
