Italy teases selective implementation of MiCA guidelines: report

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As an experienced financial analyst, I believe that the Bank of Italy’s stance on crypto assets, specifically electronic money tokens (EMTs) and asset-reference tokens (ARTs), is a prudent one. The Italian government’s decision to allow only EMTs while potentially restricting ARTs is in line with maintaining public trust and ensuring the stability of the payment system.

According to the latest EU regulations on crypto assets, Fabio Panetta, Governor of the Bank of Italy, has unveiled directives geared towards electronic money tokens issued by banks, aiming to ensure stability within the payment system.

The Bank of Italy is planning to provide clarification for financial institutions on the European Union’s regulations concerning crypto assets, according to Reuters. This move aims to ensure the security and stability of the payment system.

At a recent gathering of the Italian Banking Association, Bank of Italy governor Fabio Panetta raised some concerns. He suggested that the European Union’s Market in Crypto Asset Regulation (MiCAR), which permits electronic money tokens (EMTs) and asset-reference tokens (ARTs) to be used as payment methods, could potentially conflict with Italian law.

Based on MiCAR regulations, entities releasing AR Tokens (ARTs) and Electronic Money Tokens (EMTs) in the European Union must obtain the necessary authorization to conduct related activities. The specifications for this authorization can be found in MiCAR, with additional technical standards and instructions provided by the European Banking Authority. Notably, Panetta indicated that Italy may only approve the issuance of EMTs, without endorsing ARTs at present.

In simpler terms, we believe that Electronic Money Transfers (EMTs) are the most effective methods for maintaining public trust in transactions, as they can be provided by banks or electronic money institutions.

Fabio Panetta

Italy’s stance on implementing MiCAR selectively remains uncertain, but reports suggest the country is exploring stricter punishments for crypto-related misconduct. Proposed legislation includes potential fines ranging from €5,000 to €5 million ($5,400 to $5.4 million) for infractions such as insider trading and unauthorized sharing of confidential information.

The decree grants the Bank of Italy and Consob regulatory authority over cryptocurrency transactions. Their responsibilities include preserving financial security and promoting market harmony.

In the beginning of 2023, the Bank of Italy underscored the importance of a robust and risk-managed regulatory structure for stablecoins. This was to prevent a catastrophic situation where these digital assets could experience a destabilizing rush or panic sell-off. The Italian financial regulator specifically called for increased regulatory scrutiny, focusing on stablecoin issuers, due to their significant connections with decentralized finance.

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2024-07-09 15:08