The European Securities and Markets Authority (ESMA) has unveiled its second consultation paper on Markets in Crypto-Assets (MiCA) mandates. This release, dated October 5th, spans a comprehensive 307 pages. Significantly, the regulator is soliciting feedback from stakeholders on five pivotal areas of MiCA.
These areas encompass the incorporation of sustainability indicators for distributed ledgers. Additionally, ESMA focuses on the disclosure norms about inside information. Moreover, the authority is keen to understand the technical prerequisites for white papers. As the crypto world expands, trade transparency measures and record-keeping for crypto-asset service providers (CASPs) are also gaining prominence.
Hence, the ESMA’s focus isn’t just on the virtual world. They meticulously monitor quantitative energy usage metrics to highlight their environmental commitment. Besides this, greenhouse gas emissions and waste generation are under the scanner. Moreover, the authority has made qualitative observations on how equipment used by blockchain network nodes might be affecting our natural resources.
To bolster post-trade transparency, ESMA proposes an interesting guideline. CASPs might soon be mandated to record and publicize information diligently. This includes the date and time of trading, the identity of the crypto asset, its pricing details, volume, place of execution, and the transaction’s unique ID.
However, ESMA isn’t imposing an iron grip on the data format. They suggest that CASPs maintain their transaction data in whatever format they deem fit. Yet, they must be prepared. If regulators ever beckon, CASPs should swiftly transform this data into a specified form.
With the clock ticking, ESMA is on a tight schedule. By June 30th, 2024, they aim to roll out a conclusive report that assimilates all the feedback received. They plan to present draft technical standards to the European Commission. Before this grand reveal, the regulator intends to release a third consultation package in early 2024.
It’s essential to note that ESMA’s engagement with the crypto realm has been around for a while. In July, they had already published a preceding consultation document. In that release, they had proposed a plan for crypto firms. Consequently, once under the MiCA registration, these firms would be obligated to furnish additional data in the form of notifications. These would be directed to their registration country’s National Competent Authorities (NCAs).
