As the EU continues to roll out landmark regulations
like MiCA, PSD3, and the Financial Data Access (FIDA) framework, a
critical question emerges: Are we regulating innovation
effectively, or simply reacting to it?
The recent EBA No Action Letter on the
interplay between MiCA and PSD2 is a clear signal that the current
approach, regulating based on the type of technology or product, is
reaching its limits. The letter offers temporary relief to crypto
firms dealing with electronic money tokens (EMTs), but it also
exposes a deeper issue: Regulatory
Fragmentation.
A Better Way Forward: Trust-Based, Functional Regulation
Instead of creating a new silos for every emerging technology,
the EU has an opportunity to pivot towards a more
pragmatic, principle-based framework. One that
focuses not on whether a service is "crypto" or
"traditional", but on whether it meets the core tenets of
financial regulation:
