Lawmakers in the European Union have approved a new crypto licensing regime and transfer of funds regulation, making the EU the first major jurisdiction to introduce comprehensive crypto laws. The Markets in Crypto Assets (MiCA) regulation requires crypto operators to seek a license to operate across the EU and identify their customers to prevent money laundering.

The Transfer of Funds regulation requires issuers of stablecoins tied to the value of other assets to maintain sufficient reserves. The rules will begin to apply from next year, and the EU hopes they will protect consumers, safeguard financial stability, and boost the EU’s position in the token economy.