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The European Securities and Markets Authority (ESMA) has called for stricter cybersecurity measures under the EU’s Markets in Crypto-Assets Regulation (MiCA). This comes as the crypto industry continues to be plagued by cyberattacks, with over $1.5 billion stolen from crypto companies in the first half of 2024. ESMA believes it’s time for lawmakers in Brussels to enforce third-party cybersecurity audits to protect the industry from hackers. The regulator wants to see these audits as a mandatory requirement for crypto companies under the new MiCA regulation, which is set to fully roll out in December. Pushback from the European Commission The EU says MiCA will bring order to the industry. The regulation covers a broad range of entities, including exchanges, brokers, custodians, and trading platforms. While ESMA is adamant about the need for tighter cybersecurity, the European Commission isn’t sold on the idea. They argue that ESMA is overstepping its boundaries by trying to add this new requirement to MiCA. The commission has pushed back, claiming that the current legislation doesn’t support the addition of third-party cyber audits. Blockchain analytics firm Chainalysis reported that crypto thefts have risen by 84% compared to the same period in 2023. More than 150 hacking incidents were recorded in H1, with centralized exchanges being the prime targets. Chainalysis pointed out that crypto thieves are increasingly focusing their efforts on these platforms.  Recent high-profile attacks include a $45 million theft from Singapore-based exchange BingX and a $230 million heist from WazirX, an Indian exchange that collapsed after the attack. Under MiCA, crypto companies will need to get licensed by one of the EU’s member countries. This includes proving that their executives are “fit and proper” and demonstrating that their anti-money laundering controls are solid. Regulatory pressures Charles Kerrigan, a partner at law firm CMS, said, “Security’s…

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Filed under: News - @ October 16, 2024 4:28 pm