Italy Rejects MiCA and Advocates for the Digital Euro
21h05 ▪
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min read ▪ by
Italy raises concerns! The MiCA legislation falls short of adequately addressing the systemic risks associated with crypto-assets. According to the Bank of Italy’s Governor Fabio Panetta, the only way to ensure the stability of the fast-evolving European financial environment is through a Central Bank-backed digital euro. More information is provided in the paragraphs below!
In brief
Bank of Italy Governor Panetta emphasizes that the MiCA framework is inadequate for effectively managing risks associated with crypto assets. He advocates for the digital euro as the only reliable resolution amid the complications facing the European crypto landscape.
Ineffective MiCA: Italy calls for enhanced crypto regulation
The MiCA regulations were established in June 2023 and are slated to take effect in December 2024. In his yearly report, Fabio Panetta argues that this regulatory framework does not promote the adoption of compliant stablecoins within Europe.
Since the inception of the MiCA law, only a handful of EMT stablecoins have been issued. In Italy specifically, the creation of these digital assets has been minimal, despite the rising demand for crypto custody and trading services.
What’s even more alarming is that the MiCA regulations do little to safeguard investors from risks posed by unregulated international platforms. EU citizens remain vulnerable to failures from issuers operating outside the jurisdiction, as highlighted in Panetta’s report, which calls for immediate global regulatory cooperation.
The digital euro: a strategic response to the challenges of the crypto financial system
Given these shortcomings, the digital euro emerges as a more structured solution. Panetta advocates for accelerating this initiative to address the increasing demand for secure and sovereign digital payments.
He maintains that only a public digital currency can provide the trust and functionality expected in the crypto sphere. The surge in demand for dollar stablecoins underscores this necessity.
Tether’s disregard for MiCA, deemed “risky” for the European banking sector by its CEO, further escalates the tensions. Thus, the European Union must play a crucial role in:
- Its monetary sovereignty;
- Its economic stability.
As cryptocurrency continues to challenge traditional financial structures, the digital euro surfaces as a vital tool for resilience. Europe must transition from intentions to decisive actions!
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I’m Ariela, 31 years old, and I’ve spent 7 years in web writing. Although I discovered trading and cryptocurrency recently, I find this field highly intriguing. The topics explored here allow me to expand my knowledge. In my spare time, I enjoy singing, as well as music, reading, and caring for animals!
DISCLAIMER
The views, thoughts, and opinions expressed in this article are solely those of the author and should not be interpreted as investment advice. Always conduct your own research before making any investment decisions.
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