Vitalik Buterin Plans to Streamline Ethereum for a Safer Future

The European Central Bank (ECB) and European Commission are having a public dispute over MiCA and stablecoin regulation. The ECB believes that restrictions aren’t harsh enough, fearing US firms dominating the market.

The Commission disputed the ECB’s fears, alleging that it’s building up stablecoin-related fears to promote a controversial digital euro program. There are already signs of European irrelevance to Web3, and more restrictions likely wouldn’t help.

ECB Thinks MiCA is Too Lenient

MiCA only took effect four months ago, but the ECB is already having serious second thoughts. According to a recent report, it is concerned about the relative competitiveness of USD stablecoins, which may take over the European market.

As one commentator, Mikko Ohtamaa, put it, it has good reasons to worry about the future:

“The EU had the first mover advantage with the regulation and they screwed it up. No EU stablecoin is internationally competitive because the inherited business unfriendliness that was baked into the MiCA by the lobbying efforts of banks and other legacy financial institutions,” he claimed via social media.

Since the EU first approached the topic of stablecoin regulations, it has profoundly impacted the region’s market. After MiCA took effect, Tether left the European market altogether.

Most recently, Ethena Labs, too, pulled out of Europe after failing to get MiCA approval. These firms had no such problems in the US.

In an interesting twist, the ECB’s concern is not that MiCA is too harsh, thereby preventing innovation. As Politico claimed, it instead worries that existing regulations aren’t strong enough.

Instead, it acknowledged President Trump’s stated goal to use stablecoins to promote dollar dominance and fears that US assets could flood European markets. It wants to fight back head-on.

This is at the heart of the controversy between these EU institutions. The European Commission reacted with hostility to the ECB’s proposed MiCA changes.

Apparently, the Commission claimed that some of its specific concerns were “nonsense,” and suggested that it was merely continuing to push for the controversial digital euro.

That is, it seems that most EU institutions are satisfied with existing stablecoin regulations. Besides, if the ECB gets its proposed MiCA reforms, would that even matter?

The crypto markets reacted with shocking ambivalence to its recent rate cuts. Europe is in danger of falling behind in the global Web3 economy, and more restrictions aren’t likely to help.

The post ECB Wants to Change MiCA Rules, Citing Risks from Trump’s Pro-Crypto Shift appeared first on BeInCrypto.

The US DOJ just published a new directive claiming it will stop investigating and criminally charging crypto exchanges, mixers, and offline wallets.

This has produced a mixed response from the crypto community. Some sectors are jubilant about the potential freedom for business, while others fear the growing problem of fraud and criminal money laundering.

DOJ is Moving On From Crypto

The US financial regulatory apparatus has been much more friendly to crypto since President Trump took office. The SEC is reviewing its guidelines, the FDIC is working to prevent future debanking, and the entire political climate is changing.

Today, the Department of Justice (DOJ) released a statement claiming it will no longer investigate crypto entities.

“The Justice Department will stop participating in regulation by prosecution in this space. Specifically, the Department will no longer target virtual currency exchanges, mixing and tumbling services, and offline wallets for the acts of their end users or unwitting violations of regulations,” the DOJ’s statement claimed.

The DOJ’s statement applies to cryptocurrency exchanges, wallets, and crypto mixers like Tornado Cash. It builds on the Department’s previous announcement today, claiming that it disbanded the National Cryptocurrency Enforcement Team.

The department gives itself room to prosecute individual bad actors, but only in specific circumstances.

The US DOJ has been notorious for leading some of the biggest criminal investigations against crypto exchanges, such as Binance and KuCoin. Its critical investigation and charges against Binance led to the record $4.3 billion settlement in 2023.

However, the department is now moving on from crypto. According to today’s announcement, it will even drop any ongoing investigations against such entities immediately.

Also, it will not pursue legal liability for developers whose code is used by others to commit crimes, and it has closed all active investigations.

While it was expected that the department would lower its crypto enforcement under Trump, the complete laissez-faire decision has caught the crypto by surprise. Following the news, Tornado Cash (TORN) surged nearly 10% today.

The Department also asked regulators to review victim compensation laws. Although this is arguably a victory for crypto, it may also enable future finance crimes.

Will Crypto Crime Run Riot?

Crypto sleuth ZachXBT recently claimed that there is an “eye-opening” level of North Korean activity in DeFi. If the department turns a blind eye to major criminal operations on these exchanges and mixers, it may enable serious violations.

After the announcement first broke, crypto Twitter was filled with users declaring that “crime is legal now.”

Additionally, the industry may be pushing its luck with a dramatic move like this. Crypto scams are at an epidemic level right now, and the market is very uncertain.

The DOJ is disabling its ability to target criminals on exchanges and mixers, with little guarantee that it can enforce the law. In other words, it may be removing critical guardrails to prevent future disasters.

“Crypto lobby: ‘Sure, Trump nixed the Crypto Enforcement Team, directed Major Fraud prosecutors to stop prosecuting crypto cases, and is trying to exempt crypto platforms from the Bank Secrecy Act, but they wrote right here that they care about stopping crypto crime! Reject the evidence of your eyes and ears!’” claimed crypto researcher Molly White.

Overall, it’ll be difficult to fully predict the implications of the department’s new policy on exchanges. For now, this directive will give many crypto-related businesses the freedom to conduct operations as they see fit.

Hopefully, business will proceed as usual without any serious controversies.

The post US Justice Department (DOJ) Will Stop Investigating Crypto Exchanges and Wallets appeared first on BeInCrypto.