The compliance with the European Union’s Markets in Crypto Assets (MiCA) law is barely three days in and has already drawn major misconceptions. On this premise, Circle’s Policy Head Patrick Hansen took to X to clear a few of the misconstrued takes.

Crypto Exchanges, Travel Rule and MiCA

The Circle executive admitted to seeing several post from people who were mixing up EU’s Transfer of Funds Regulation (TFR) Travel Rule and the newly implemented MiCA. The former mandates financial service providers to gather and exchange customers data amongst others. The Travel Rule also came into force on December 30, 2024, the same day as MiCA.

As a result of its implementation, Hansen said Crypto Asset Service Providers (CASPs) like custodian and brokers are now required to request for more information from users. This applies to both sender and receiver in any transactions. In addition, he added that CASPs are at liberty to exchange this information within themselves.

The Circle Policy Head said this info exchange might take place through encrypted channels or travel rule networks like Trust or Notabene. The aim is to ensure that customers are not exposed to scams while trying to complete their crypto transactions. CASPs can also take some more delicate steps, depending on the amount of funds involved.

Quick addition since I am seeing a ton of people mixing up EU crypto regulations (MiCA & TFR):

Yes, since end of last year, the EU implementation of the travel rule (TFR) is in force as well. The application date (December 30th) was the same as for MICA.

Exchanges and other… https://t.co/FYn2RN8Ei7

— Patrick Hansen (@paddi_hansen) January 2, 2025

Specifically, Hansen said CASPs would request that a customer verify ownership of his self-custody wallet once the transaction tops €1,000. Noteworthy, TFR or Travel Rule, like MiCA is designed to combat money laundering and terrorist financing.

However, Hansen stated clearly that both rules are entirely unrelated, the major miscommunication among users.

MoonPay Secures Approval Under New Regime

Several crypto asset service providers are making efforts to ensure that they are not left out of the new crypto regulation dispensation in the EU. Renowned crypto infrastructure service provider MoonPay is one of firms that has taken a monumental stride by securing MiCA approval.

By all means, the move aligns with the firm’s expansion plans in Europe. Meanwhile it has also positioned MoonPay as a crypto regulation-compliant entity in Europe.

In the past, it has gained significant traction while empowering crypto payments across the region. With this achievement and the continuous bull cycle in 2025, MoonPay is likely to capture more EU market share.

 

The post MiCA Rule: Circle Policy Head Corrects Key Compliance Misconceptions appeared first on CoinGape.

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Filed under: News - @ January 2, 2025 11:26 pm