"MiCA: From the Crypto Market to Financial Infrastructure"

For years, the crypto-asset ecosystem operated largely outside the traditional financial system. Banks, accustomed to managing risk under stringent regulatory and consumer protection standards, watched its progression with a mixture of interest and wariness. That began to change with the arrival of MiCA. Europe became the first major jurisdiction to roll out a comprehensive, harmonized regulatory framework for crypto-assets, and its phased implementation marked a turning point by introducing, for the first time, common standards for governance, transparency, security, and investor protection.

With clear rules finally in place, banks and other regulated institutions have been able to enter this ecosystem, bringing their expertise in risk management and helping an industry that is still taking shape to become more mature, stable, and mainstream. Rather than stifling innovation, regulation creates the conditions for the market to grow in a safe and sustainable way. And yet this legal certainty does not make MiCA a static framework, for the market to which it applies today is already very different from the one that existed when the regulation was originally designed.

With clear rules finally in place, banks and other regulated institutions have been able to enter this ecosystem, bringing their expertise in risk management...

Against this backdrop, the European Commission launched a public consultation last May to assess how MiCA is working and determine whether it remains fit for purpose in light of the market’s rapid evolution and the fast-changing international landscape. Since MiCA entered into force, other major jurisdictions have stepped up their own regulatory efforts, albeit with different approaches. The United States has enacted its first federal framework for payment stablecoins, designed not only to regulate the market but also to strengthen the U.S. dollar’s international role. Meanwhile, the United Kingdom is moving forward with its own regulatory regime for crypto-assets and payment stablecoins, with the aim of preserving its status as a global financial hub.

This wave of regulatory activity reflects a broader shift. The center of gravity in the debate is moving away from cryptocurrencies themselves and toward new forms of tokenized money and the technology that underpins them. The question is no longer simply how to regulate the crypto market, but who will define the rules and build the infrastructure that will support the payments systems and financial markets of the future.

The opportunities offered by this technology are immense. From near-instant settlement of financial transactions to new financing models and more efficient cross-border payments, tokenization has the potential to transform processes that still rely on infrastructure designed decades ago. It also makes it possible to embed rules and automation directly into assets and transactions, reducing operational friction and enabling entirely new financial services. Realizing that potential, however, will require more than well-crafted regulation.

The question is no longer simply how to regulate the crypto market, but who will define the rules and build the infrastructure that will support the payments systems and financial markets of the future

That is why MiCA should be viewed as a necessary—albeit not sufficient—condition for transforming Europe’s financial system. The regulation is now entering its second phase, in which it must remain flexible enough to keep pace with technological change without compromising the principles on which it was built: financial stability, market integrity, and investor protection.

The challenge, therefore, is to combine a robust regulatory framework with the technological capabilities needed to unlock the full potential of digital assets. That is precisely the goal of Project Agorá, an initiative spearheaded by the Bank for International Settlements (BIS) alongside several central banks and private-sector institutions. Through a prototype, the project has demonstrated how tokenization can reduce friction in wholesale cross-border payments. Similarly, initiatives such as Pontes and Appia, promoted by the European Central Bank, aim to facilitate the settlement of tokenized transactions in central bank money and lay the foundations for a more integrated European financial ecosystem. Together, these projects reflect a vision shared across much of the industry: true innovation is not simply about creating new digital assets, but about modernizing the financial infrastructure that underpins the real economy.

MiCA should be viewed as a necessary—albeit not sufficient—condition for transforming Europe’s financial system

Looking ahead, MiCA will likely be remembered for more than simply regulating crypto-assets. It may well come to be seen as one of the key catalysts for a far broader transformation of Europe’s financial infrastructure. Ultimately, MiCA’s significance will lie not only in being the world’s first comprehensive regulatory framework for crypto-assets, but also in its ability to evolve alongside innovation and help ensure that Europe remains at the forefront of building the digital financial system of the decades ahead.