Having been approved by the the European Parliament’s Committee on Economic and Monetary Affairs on October 10, 2022, the Markets in Crypto Assets regulation [MiCA] is one step closer to adoption [See, e.g. Givan, K. MiCA bill contains clear warning to crypto influencers. (Accessed November 3, 2022)]. The last major step for its adoption remains a plenary vote in the European Parliment and its passage is expected within the next several days [See, e.g. Schoenberg, G. MiCA bill contains clear warnings for cryptocurrency influencers. (Accessed November 3, 2022)].
MiCA is one of the first attempts to provide an absolute and comprehensive regulation of the cryptocurrency industry. The pending law contains regulations covering topics ranging from accountability, DeFi, NFTs, Stablecoins, money laundering, as well as virtually every other major aspect present in the industry. [See, e.g. Trajcevski, M. Crypto Influencers Could Face Market Manipulation Charges As MiCA Nears Enforcement, (Accessed November 3, 2022)].
The Director of EU strategy and policy for stablecoin issuer Circle, Patrick Hansen, has for some time now been monitoring the path toward the passage of MiCA. By way of a tweet dated November 1, 2022, Hansen has highlighted a provision of the pending regulation which covers public comments on crypto assets made without appropriate disclosure [See, e.g. Huigsloot, L. MiCA bill contains a clear warning for crypto influencers. (Accessed November 3, 2022)].
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To clarify, what Hansen is warning about is when an Influencer voices an opinion on a crypto asset after establishing a position in that asset and not disclosing the position constitutes a conflict of interest and could effectively be deemed market manipulation in violation of the regulation [See, e.g. Huigsloot, supra]. Accordingly, it should come as no surprise that this provision is part of the regulations measures designed to “prevent insider trading, unlawful disclosure of inside information and market manipulation in relation to crypto assets, to ensure the integrity of crypto asset markets” [See, e.g. Givan, supra].
Interestingly, although the language of the pending regulation is somewhat vague as it relates to exactly what is covered, some believe it could be extended to include the Elon Musk Doge Meme presently circulating on the internet [See, e.g. Young, M. Crypto Influencers Could Face Market Manipulation Charges Under MiCA. (Accessed November 3, 2022)].
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While the reaction is somewhat mixed on this issue, some responders are questioning why these rules do not apply to other types of assets. But those in favor of this provision agree that the crypto influencers and coin shillers should display more transparency in their communications [See, e.g. Young, supra]. A related post via Reddit makes it appear the crypto community is receptive to the passage concerning influencers. The top comment in the sub-Reddit makes clear:
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Patrick Hansen has referred to the passage of MiCA as a 'mere formality following the text finalization on October 5, 2022. Nonetheless, the regulation is not likely to be fully applicable in operation until 2024 [See, e.g. Huigsloot, supra].
