New EU law will regulate the collection of NFTs like cryptocurrencies

August 2nd,

During a panel at Korea Blockchain Week, European Union (EU) advisor Peter Carstens provided new insight into the EU’s efforts to develop a comprehensive regulatory regime in the crypto and NFT spaces. According to Carstens, under the Markets in Crypto-Assets Act (MICA), NFT collections will receive the same treatment as cryptocurrencies, coindesk Report

With this new classification, EU citizens hoping to sell NFT collections will fall under the umbrella of crypto-asset service providers (CASPs), and must receive express approval from the EU before offering their services (or goods). public. Through these measures, the EU hopes to “protect investors and preserve financial stability, while allowing innovation and increasing the attractiveness of the crypto-asset sector,” according to a press release. This process is expected to take anywhere from one to three months, with larger CASPs reporting on their activities regularly submitted to the European Securities and Markets Authority (ESMA) by their local governments.

With this aggressive stance on NFTs, the EU also hopes to reduce instances in which crypto assets are used for money laundering and other illicit purposes. As part of this new classification, anyone launching an NFT collection within the EU’s jurisdiction will have to submit a white paper on NFT’s protocol. Carstens also clarified that over-the-top commitments on the future value of any given NFT project are expressly prohibited. CoinDesk Report Through these measures, the EU hopes to lay the groundwork for holding them legally accountable for their actions.

On the other side of the pond, US efforts to regulate the crypto and NFT spaces have largely focused on bad faith actors using emerging blockchain technology as a means to commit white-collar crimes. With former employees of Coinbase and OpenC recently charged with insider trading, many of these early steps to regulate Web3 in the United States came down to the development of specialized cybercrime divisions at institutions such as the IRS and FBI.

As both sides slowly move toward regulating the historically-unruly world of NFTs and crypto, it remains to be seen which strategy will pan out more effectively in the long run.

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