Autorenname: Aya Abou Shakra

On October 5th, the EU Council’s Committee of Permanent Representatives endorsed the final compromise texts of the Markets in Cryptoassets Regulation (MiCA) and the recast Regulation on information accompanying transfers of funds and certain cryptoassets. This is the next step in finalising the legislative procedure for the regulation. The next steps are formal approval by, first the EU Parliament plenary and then by the Council before they can be published in the Official Journal. The steps in the legislative process can be found here https://lnkd.in/eXJNUz3g MiCA establishes a framework that regulates the work of issuers of unbacked crypto assets, stablecoins, trading platforms, and wallets in which crypto assets are held. MiCA regulates issuers and service providers of crypto-assets, as well as it features rules with regard to market abuse. It is intended to harmonize the EU market, create regulatory certainty, improve customer protection and strengthen financial stability. The Transfer of Funds Regulation (TFR) is part of a package of legislative proposals to strengthen the EU’s anti-money laundering and countering terrorism financing (AML/CFT) rules, presented by the Commission on 20 July 2021, and will become applicable once MiCA does. The TFR compliments MiCA by adding an anti-money-laundering layer to the user protection offering of the MiCA proposal.

As we bring in-depth industry knowledge on Payments, Banking, and Insurance & Pension practices, we want to highlight an important topic going on in the Banking market which relates to how the Digital Euro Project has started the prototyping exercise. As part of the investigation phase of the digital euro project, which started in October 2021, the ECB has selected five companies (Amazon, CaixaBank, Worldline, EPI, Nexi) for the joint prototyping exercise https://lnkd.in/dhYKFBye . The aim of this prototyping exercise is to test how well the technology behind a digital euro integrates with prototypes developed by these companies. Simulated transactions will be initiated using the front-end prototypes developed by the five companies and processed through the Eurosystem’s interface and back-end infrastructure. The prototyping exercise is expected to be completed in the first quarter of 2023. Prototyping is an essential element in (digital) transformation strategies as it will save time, money and effort in the long run. It allows for quick feedback rounds and to test and review real-life product cases in the early stages of strategic transformations. In this way prototyping helps to define and refine the route to a successful transformation. The strategic objective of a digital euro issued by the Eurosystem would be to provide a monetary anchor in the digital age, serving as a public good. It could foster innovation, increase the efficiency of payments, and support the overall economic efficiency of the European Union.