- Gemini and Coinbase eye EU expansion under new MiCA regulations.
- Gemini’s Malta approval, Coinbase’s Luxembourg filing raise regulatory concerns.
- Experts urge uniform rules to protect EU crypto market stability.
The European Union is on the verge of a major shift in the digital finance landscape. Two major crypto firms, Gemini and Coinbase, among others, are preparing to scale their operations across the 27 countries of the EU single market due to the new Markets in Crypto-Assets (MiCA) regulation. Nevertheless, not everyone is happy with this turn of events.
Coinbase Applies via Luxembourg, Gemini Set for Malta Approval
According to Reuters, both the corporations are likely to get their license in various EU countries. Gemini is expected to receive approval in Malta, whereas Coinbase has applied Luxembourg. Such nations are characterized by crypto-based policies and smooth regulation procedures. Even though this appears to be good news to the crypto industry, it has brought a few eyebrows to financial regulators.
Especially, the fast licensing policy in Malta is now controversial. In the past, the nation provided operational licenses to OKX and Crypto.com, among the companies, after a few weeks of MiCA launch. Whereas the Financial Services Authority of Malta explains such by the years of experience in the crypto field, not everyone agrees. The opponents claim that speed can be achieved at the expense of appropriate scrutiny.
In the meantime, Luxembourg, where Coinbase has also applied, can be regarded as a crypto company-friendly jurisdiction. The process of application has been longer; however, Coinbase is already significant in Europe, employing approximately 200 people on the continent. Nevertheless, there is a question mark regarding the licensing date of Coinbase since the company is quiet about it.
Conversely, this has raised an alarm with other regulators in the EU. The European Securities and Markets Authority (ESMA) is keeping a close eye on the Maltese activity. It is in the process of evaluating the licensing processes in the country, and it will publish a report shortly. The financial authority of France has taken it a notch further to warn that this type of inconsistent application can provoke what it terms as a regulatory race towards the bottom.
Coinbase, Gemini Move Raises Regulatory Questions in Europe
It is important to understand that MiCA was introduced to harmonize crypto regulation across the EU. The idea was to provide crypto assets with similar supervision as conventional financial products. Nevertheless, when other nations are issuing licenses too fast without careful screening, the whole system may be undermined.
In addition, it is not the first crypto company to receive such a license. In February, Bybit was granted a MiCA license in Austria, giving it the ability to provide services in the EU. What this example demonstrates is that growth can be achieved within the correct regulatory measures; however, it also shows the need for uniform enforcement.
An anonymous senior European regulator added that he was worried about the issue of countries with fewer regulatory staff granting licenses too freely. Such a situation, according to this official, might pose certain risks to the rest of the financial system because of the possibility of less stringent reviews due to limited staff.
Gemini and Coinbase’s EU launch boosts crypto adoption. However, regulatory challenges remain. Therefore, unified standards across EU nations are crucial. Without this, transparency and trust may suffer. Ultimately, MiCA’s goals risk being undermined.
