EU Issues Warning to Crypto Influencers Before MiCA Legislation Goes Live
The European Union (EU) has decided to pay special attention to how the crypto sector is being promoted on social networking platforms. Now that the MiCA bill is ready to become an official legislation in the EU, crypto influencers have been warned against advertising digital assets without providing full disclosure about the financial risks associated with the sector. Profiting from illegal crypto promotions would be treated as manipulation of the MiCA laws, that will be a punishable offense.
Crypto influencers, or social media celebrities that engage with their audiences over crypto-related information, will have to ensure that their viewers are aware of the volatility and other blurry aspects associated with the sector.
Patrick Hansen, EU strategy and policy director for Circle Pay has highlighted this notable clause in EU’s document. Circle Pay is the issuer of the USDC stablecoin.
Crypto influencers beware: Commenting on crypto assets in (social) media without disclosure and profiting from the effects of that will be considered market manipulation in the EU once MiCA is in force.@zachxbt pic.twitter.com/BflVXPazjS
— Patrick Hansen (@paddi_hansen) November 1, 2022
By tightening the noose around crypto influencers, the MiCA bill aims to prevent insider dealing, unlawful disclosure of inside information, and market manipulation related to crypto-assets from happening.
6/ Due to the August summer break in Brussels, it could take until the end of September/sometime in October until a final regulatory text is formulated and finalized.
These texts will still not be public but are normally leaked and should circulate at some point.
— Patrick Hansen (@paddi_hansen) August 6, 2022
The European Parliament Committee on Economic and Monetary Affairs (ECON) approved the MiCA legislation in October. First proposed in September 2020, the MiCA draft aims to create a uniform legal crypto framework for all the 27 EU states.
The Markets in Crypto Assets (MiCA) framework largely revolves around consumer protection as well as prevention of market manipulation and financial crimes in the crypto sector.
The tuning and execution of these crypto policies could go into effect starting in 2024.
The EU is being very active in shaping up its crypto sector.
Last month, the EU imposed a complete ban on all cross-border crypto transactions directed towards Russia in the backdrop of the ongoing Ukraine-Russia war.
