Coinbase and Gemini, two major players in the cryptocurrency market, are close to obtaining licenses to operate in the European Union under the new Markets in Crypto-Assets (MiCA) regulation.
Regulatory Landscape of MiCA
The MiCA regulation, which came into effect earlier this year, allows EU member states to issue licenses to crypto companies for access to all 27 member countries. However, the licensing process has raised concerns among regulators due to disputes over the pace and standards of approvals.
Licensing in Malta and Its Consequences
Gemini, an American cryptocurrency exchange founded in 2014, is set to obtain a license to trade from Malta. The quick licensing process in Malta has attracted the attention of other national regulators, with fears that it could lead to a 'regulatory race to the bottom.' An official source mentioned the need for reviews of Malta's licensing process, and a report on this issue is forthcoming.
Coinbase Expansion in Luxembourg
Coinbase is on the verge of obtaining a license to operate in Luxembourg. Although the size of its planned operations in Luxembourg is relatively minor, Coinbase already has a notable presence there. The company plans to expand its European workforce by at least 20 roles this year.
The licensing of Coinbase and Gemini in Europe highlights the importance of regulation in the crypto industry and sparks diverse debates among regulators about standards and licensing speeds.
