Gemini and Coinbase Set to Acquire EU Licenses
Gemini and Coinbase, prominent players in the crypto-exchange world, are reportedly in the process of obtaining licenses to operate within the European Union. This step is significant as it aligns with the newly established regulations for cryptocurrencies under the MICA framework.
Gemini is expected to gain approval from Malta, while Coinbase aims to secure a license via Luxembourg, according to a report. The information comes from an unidentified source familiar with the situation.
A spokesperson for Coinbase chose not to provide specifics regarding their application, but mentioned that Luxembourg holds a reputation as a “respected global financial centre.”
These moves see Gemini and Coinbase joining other major exchanges relocating to the EU under MICA. Recently, BYBit also received regulatory approval to operate in the region, particularly through Austria.
Earlier this year, Binance adjusted its deposit and withdrawal procedures in Poland to adhere to the MICA framework.
The regulations under MICA took effect in June 2024, with full implementation rolling out in December after final guidance was issued by the European Securities and Markets Authority (ESMA) to member states.
This regulatory framework aims to create uniformity across the region, enhancing investor protection and supporting financial stability.
Controversy Surrounding MICA Regulations
While some industry observers welcome MICA for its potential to clarify the swiftly changing landscape of cryptocurrencies, feedback isn’t universally positive. For instance, a report from Chain Analysis noted that certain aspects of the rule still leave room for “interpretation and uncertainty,” particularly concerning stubcoins.
A contentious requirement mandates that stablecoin issuers hold a “slight” portion of their reserves in European banks. This stipulation is primarily why Tether, the issuer of USDT, decided against seeking registration under MICA.
However, at least ten other stubcoins have been approved under this framework, including those issued by Circle, Crypto.com, and Société Générale, among others.
Despite the approvals, initial signs indicate that the uptake of stablecoins under MICA is not particularly enthusiastic.
For instance, in Italy, a major market within the EU, MICA hasn’t spurred significant recruitment efforts, according to Fabiopanetta, a former official at the European Central Bank and the current governor of the Bank of Italy. Instead, he noted that there’s a growing interest in “management services and trading services.”
This shift in focus raises questions about the initial aims of the cryptocurrency movement, which sought to disrupt traditional banking, yet appears to be evolving into something more conventional.
