2022 was a whirlwind year for crypto, to say the least.
While the year started off strong, with real technological advancements and excitement about its potential, there were noticeable challenges. Overnight support in the millions to Ukraine, 1 billion donated in COVID relief, and legislative gains in the EU and Asia, were accompanied by headlines around Terra Luna, Celsius, and Three Arrows. At the end of the year, the latestrevelations about FTX and the alleged criminal activity of a small group of people within the company sent massive shockwaves through the entire crypto industry. Given its importance in the space, thecontagion and fallout may not be over.
If there is one message that came across loud and clear, it’s that regulatory clarity is needed – and it’s needed now.
I often get asked why I made the switch from lawyer to investor. Usually, it is from lawyers slightly jealous that I no longer need to account for my time in six-minute increments and sometimes from financiers slightly wary that I am encroaching on their turf. Although there is no single answer to that question, I thought the launch of this column would be a good place to lay out why I did what I did and what I believe every entrepreneur building in the FinTech space should look for in a lawyer.
The Beautiful Arrival of EU Cryptocurrencies Regulation
Anyone who is directly or indirectly involved or remotely interested in the world of Cryptocurrencies has heard of the Markets in Crypto Assets Regulation (MICAR) by now. In short, MICAR aims to bring regulatory certainty and harmonisation in Europe by regulating Issuers and Crypto Asset Service Providers (CASPs) who wish to offer their services in Europe. This will result in CASPs and Issuers being able to passport their services across Europe, once authorised or registered in a chosen Member State. Notably, MiCAR is a direct regulation and not a directive. The raison d’etre for this is to leave out any room for potential regulatory arbitrage (although this will happen in other forms as I will briefly touch up on a bit later).