As explained by Decrypt, MiCA forces cryptocurrency issuers to publish a “crypto-asset white paper” that contains information about their activities and enterprise. It also forces companies that deal in stablecoins – digital assets with fixed prices unlike Bitcoin or Ethereum – to meet financing requirements, such as restricting the amount of stablecoins that can be issued if they are not priced in Euros or recognized currencies used by E.U. member states.
Furthermore, MiCA will also look to reelin crypto mining, forcing “crypto-assets service providers” to release their energy consumption data, as cryptos like Bitcoin reportedly have higher carbon-footprints than some nations all together.
This legislation will also add restrictions to the NFT market by listing them as a security instead according to University of Kentucky law professor Brian Fyre, who specializes in NFTs and securities law.
The issuance of crypto-assets as non-fungible tokens in a large series or collection should be considered as an indicator of their fungibility.
The sole attribution of a unique identifier to a crypto-asset is not sufficient to classify it as unique or not fungible. The assets or rights represented should also be unique and not fungible for the crypto-asset to be considered unique and not fungible.
The bill reads
Based-on the wording, Fyre explains that
They are saying is that when you sell a 10,000-NFT collection, what you’re really selling is shares in the project as a whole. n other words, each NFT is functionally just a fungible share in the value of the entire project.
To simplify that even further, per Fyre’s analysis, that a holder of a NFT does not own a singular unique piece of art, but rather a share of in the collective value of the NFT brands and collections.
‘The bill, which is aligned with the MiCA, asks crypto-assets service providers to provide information to authorities if an investigation is conducted into money laundering and terrorist financing,’ Decrypt added.
At the time of this publication, almost all major cryptocurrency stock prices got slammed, after already trending downward for the last several days.
The WinePress has noted in recent weeks that the United States and Australia have also been looking to crackdown on cryptocurrencies as well:
Australian Securities and Investments Commission Looks To Mitigate Larger Cryptocurrencies
AUTHOR COMMENTARY
[4] Labour not to be rich: cease from thine own wisdom. [5] Wilt thou set thine eyes upon that which is not? for riches certainly make themselves wings; they fly away as an eagle toward heaven.Proverbs 23:4-5
As I have said many times before, I was already sketched-out by cryptos and did not trust them as any kind of long term investments, and as a “safe haven” asset. Now with the E.U. weeks away from regulating them – stripping away one of the greatest and core appeals – I would presume the value of most if not all of them will plunge, especially with the threats of the U.S. and so many other nations considering something similar.
The value of Bitcoin, for example, has greatly plummeted largely because there was a ton of uncertainty to begin with this past year with the threat of regulation.
Will these regulations by the final nail in the coffin for cryptos and NFTs? I can’t say, but regulation will definitely turn off a lot of potential new investors and traders.
I have theorized before that these cryptos and NFTs could be perhaps ported to the proto-metaverses already in existence, which could be the sales pitch needed to respark appeal in the metaverse concept.
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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