EU Plans To Equate NFTs With Securities

  • The draft of the final version of the MiCA bill was leaked to the network
  • In it, the EU proposes to equate part of the NFT to derivatives
  • The authorities explain this by the fact that the owners of tokens do not have the asset itself, but only a share in its value.

Yesterday, September 21, a draft of the legal text of the EU Cryptocurrency Act (MiCA) leaked online. Among other things, it contains references to the NFT. At the same time, some of the EU tokens are planned to be equated to securities.

The draft was accessed by the CoinDesk portal. An anonymous source of the publication states that work on the landmark law on the markets of cryptoassets (MiCA) is actually completed.

“ The essence is more important than the form ” – this is the thesis that can describe the new edition. This gives the authorities the opportunity to ” try on ” the bill not only to large cryptocurrencies, but also to a number of other assets.

In particular, we are talking about NFTs. Brian Fire, professor of law at the University of Kentucky, commented on the leak:

“Europe insists that regulators consider blue chip projects as securities,” the professor notes. “They say when you sell a collection of 10,000 tokens, you are actually realizing a share in the project. In other words, each of the NFTs represents only a fungible portion of the value of the collection as a whole.” 

Take, for example, the BAYC project. According to Fire, the authors of MiCA claim that each of the “ monkey ” holders does not own the token, but has a share in the value of the collection and its “ author ”, Yuga Labs.

In fact, this makes the tokens an investment instrument, a derivative with an issuer in the form of a developer studio. Despite the somewhat far-fetched nature of this statement, the adoption of the law in such a wording will turn out to be a serious blow to the industry. If we take into account the fact that the EU and the US are closely cooperating in the regulation of cryptocurrencies , then the situation takes a sharp turn. If the European Union equates NFTs with securities, then a similar fate awaits tokens in America.

Leave a Reply

Your email address will not be published.