How could France's proposal to revise EU crypto rules affect the Council of the European Union?
Council of the European Union must review proposed changes to EU crypto rules France's proposals to revise the Markets in Crypto-Assets Regulation (MiCA) introduce significant changes, including imposing liability on crypto exchanges for DeFi incidents and transferring supervision of significant CASPs to ESMA. As these proposals move through the legislative process, they will require formal review, approval, and endorsement from the Council of the European Union. The Council, which represents the member states' governments, plays a crucial role in adopting and coordinating these new laws across the EU.
- Effect
- Mixed
- How direct
- Stated in the reporting
- When
- Within months
- The story
- Gone quiet
How it reaches Council of the European Union
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French authorities published proposals to revise the European Union’s Markets in Crypto-Assets Regulation (MiCA). The proposal seeks to extend investor safeguards by imposing liability on crypto-asset service providers. This liability applies if platforms facilitate access to decentralized finance (DeFi) protocols without conducting necessary checks or ignoring known security risks.
The full event1independent outlet -
The European Commission develops proposals and actions, which, according to the EU governance structure, require formal review, approval, and endorsement from the Council of the European Union before they can be adopted as law.
1 report connects these two. Brind only summarizes; follow a link to read the reporting itself.
- cointelegraph.com Oct 21
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institution of the European Union representing the member states' governments bringing together national ministers from each EU country to adopt laws and coordinate policies
Everything about Council of the European Union
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The facts so far
As reported. Each one links to where it comes from.
- France proposes liability for crypto exchanges offering DeFi access if they fail to vet protocols or ignore known security risks.cointelegraph.com
- France backed plans to transfer supervision of “significant CASPs” from national regulators to the European Securities and Markets Authority (ESMA).cointelegraph.com
- The responses to the European Commission consultation will inform a report to EU lawmakers due by June 30, 2027.cointelegraph.com
Why it matters
The proposed changes represent a major overhaul of the EU's regulatory approach to digital assets, moving beyond the original scope of MiCA to address decentralized finance (DeFi). If adopted, these revisions would impose new duties on regulated platforms, requiring them to vet DeFi protocols and monitor for vulnerabilities, fundamentally changing the operational landscape for crypto-asset service providers across Europe.
This legislative push is part of a broader effort by EU member states to adapt financial regulations to rapidly evolving technology. The Council of the European Union, as the body representing member state governments, must navigate these competing interests while ensuring the new rules are both protective of investors and compatible with the EU's economic goals.
What we don't know yet
- Will the Council agree to the proposed transfer of supervision of significant CASPs to ESMA?
- What specific obligations will be placed on platforms connecting customers to uncertified DeFi protocols?
What would change this answer
Who else could feel it
Other possible ripples from the same event.
- ItalyPossibleItaly may face significant regulatory updates following EU crypto rule proposals
- European Central BankPossibleThe expanded scope of crypto regulation and liability could require the ECB to adjust its coordination with ESMA.
- BinancePossibleBinance may face new liability and vetting duties under EU crypto rules
Reporting
- cointelegraph.comOct 21
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Brind's analysis is written by AI from the reporting linked above and can be wrong. This explainer is a possibility worth considering, not a forecast: steps marked as Brind's reasoning are not stated in the reporting. It is not investment advice; do your own research.