EU Exempts Bitcoin Miners from Market Abuse Reporting

EU Exempts Bitcoin Miners from Strict Crypto Regulations

Bitcoin miners and proof-of-stake (PoS) validators in the EU received a significant regulatory break. The European Securities and Markets Authority (ESMA) has exempted them from reporting market abuse under its Markets in Crypto-Assets (MiCA) regulations.

ESMA's December decision excludes miners, validators, builders, and searchers from the definition of Persons Professionally Arranging or Executing Transactions (PPAETs). This means they are not subject to the same stringent reporting requirements as other market participants.

Impact on Bitcoin Miners:

• Under MiCA, PPAETs are primarily crypto asset service providers (CASPs) like exchanges, responsible for monitoring and reporting market abuse.
• Excluding miners and validators reduces the regulatory burden, potentially preventing them from relocating outside the EU to avoid increased compliance costs.

Patrick Hansen, Circle's director of EU strategy and policy, praised ESMA's approach as 'flexible,' stating that the decision prevents a potential increase in regulatory burdens which could have pushed miners offshore.

“ESMA also decided not to rigidly define PPAETs... keeping room for flexibility as the market evolves.”

MiCA's Broader Impact:

MiCA, implemented in June 2023, is considered the EU's most comprehensive crypto regulation. The stablecoin provision, implemented in mid-2024, led to the delisting of several non-compliant tokens from exchanges. This regulatory environment has created a ripple effect across the crypto market.

For example, the delisting of Tether's USDT from many EU exchanges benefited Circle's USDC. TradingView data shows USDC's market cap increased by nearly 80% since MiCA's launch, reaching $57 billion—slightly exceeding its 2021 peak.

While USDT also saw growth (28% to $142 billion), the significant increase in USDC's market share highlights the potential impact of MiCA's regulatory framework.

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