A widespread crypto exodus to the Middle East could be a threat as a result of the impending regulatory framework, which offers more favorable regulations.
The forthcoming cryptocurrency regulatory framework in Europe has the potential to decrease the number of Web3 firms in the region and introduce new centralization-related concerns.
The Markets in Crypto-Assets (MiCA) measure is the first comprehensive regulatory framework for the crypto industry, and it is widely regarded as a net positive.
According to Anastasija Plotnikova, CEO and co-founder of Fideum, a regulatory and blockchain infrastructure firm that specializes in institutions, MiCA, while legitimizing the crypto ecosystem, also poses a risk of fostering consolidation among crypto firms.
During the European Blockchain Convention in Barcelona, the regulatory compliance specialists disclosed to Cointelegraph in an exclusive interview:
“I am concerned that it will result in the consolidation of European and American corporations, which will subsequently relocate to the Middle East. Although the European Union has made significant strides in harmonising legislation, enforcement is ultimately the responsibility of local and national authorities, and there is significant variation in their approaches.”
In anticipation of the complete implementation of the MiCA framework, which will affect crypto-asset service providers on December 30, several substantial European financial institutions are currently in the process of preparing their digital asset offerings.
The compliance expert remains optimistic about the European crypto industry; however, she is still concerned about the overpowering of small firms by larger ones and the concern of centralization.
Plotnikova elaborated: “It will result in a significant amount of consolidation. It will be significantly more predatory, with even VC practices and larger crypto companies purchasing talent off the shelf. However, it is what it is.”
She also noted that the measure is causing the Web3 industry to become more similar to traditional finance (TradFi) by making it more challenging for firms with limited funds to scale.
Many of the world’s most prominent financial institutions are currently in the process of preparing their digital asset offerings for the implementation of MiCA.
Societe Generale, the 19th-largest banking group in the world by assets, has collaborated with Bitpanda to introduce the EUR CoinVertible (EURCV), a stablecoin that is MiCA-compliant and denominated in euros.
Jean-Mark Stenger, CEO of Societe Generale-FORGE, described the partnership as a critical step in the integration of stablecoins into the broader financial system.
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