The European Union’s digital asset regulation, MiCA, ended in 2023 and will be effective by the end of the year. However, the European Securities and Markets Authority (ESMA) report published on Wednesday says that the regulation did not cause more euro-denominated crypto transactions.
The two primary takeaways for this report are that stablecoins play a crucial role in approximately 60% of crypto transactions across the globe. This form of digital assets can be backed by traditional currencies and commodities, thus allowing the investors to modify their investment establishment without leaving the crypto ecosystem.
Regardless of the EU’s attempts to make regulations for the crypto market the euro share stays at the level of around 10% for on-ramp and off-ramp transactions. This role of the euro has been labeled as a minor role since the announcement of MiCA, with The United States Dollar and the South Korean Won accounting for more than 80% of these transactions.
The report observes that most of the trading happens on a few main exchanges, which poses a threat to the fragmentation of trading. Binance alone manages to process about half of all trading volumes, and the other 10 exchanges have control over more than 90% of deals.
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