Coinbase EU MiCA license applications are nearing completion, and at the time of writing, both major exchanges are positioning themselves for European market entry. The Gemini MiCA approval process, as well as Coinbase’s Luxembourg application, represents a significant shift in cryptocurrency regulation Europe, with the European crypto market set to welcome these industry giants under the new Maltese crypto license framework.

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How Coinbase & Gemini May Reshape Cryptocurrency Regulation in Europe

The Coinbase EU MiCA license pursuit through Luxembourg contrasts sharply with Gemini’s Malta-based approach, and right now, this divergence is creating regulatory tensions. Under the MiCA regulation, member states can issue licenses allowing crypto companies to operate throughout the 27-nation bloc, but also regulatory tensions are emerging over approval speeds.

Malta’s Fast-Track Approach Draws Scrutiny

Gemini’s MiCA approval appears imminent from Malta, which has already greenlit OKX as well as Crypto.com within weeks of the regulation’s launch. The rapid Maltese crypto license approvals have raised concerns among other European crypto market regulators, and also among various oversight bodies.

France’s AMF has publicly warned that ESMA’s lack of direct authority could lead to what they termed a “regulatory race to the bottom.” One senior regulatory official expressed concerns about accepting licenses from countries with fewer regulatory staff, citing Malta as an example.

A spokesperson for the Malta Financial Services Authority stated:

“Expedited processing was due to our in-depth understanding acquired over these years.”

Luxembourg’s Measured Response

The Coinbase EU MiCA license application in Luxembourg represents a more traditional regulatory approach, and at the time of writing, this process has been ongoing for several months. Despite being in progress for some time, questions remain about the scale of Coinbase’s planned Luxembourg operations.

A Coinbase spokesperson had this to say:

“Luxembourg was a high-bar, well respected global financial centre.”

The same spokesperson also confirmed Coinbase would hire more than 20 people in Luxembourg by year’s end, adding to its existing 200 European employees.

Regulatory Tensions Mount

The cryptocurrency regulation Europe framework faces its first major test as regulators debate approval standards, and right now, concerns are mounting. The European crypto market’s future hangs in the balance as officials worry about uneven enforcement undermining MiCA’s protective goals.

Central Bank Governor Gabriel Makhlouf compared crypto to a Ponzi scheme in 2023, warning:

“Most of the time when you gamble, you’re actually losing.”

ESMA has scrutinized Malta’s licensing process, with a report due to be circulated soon among member states. The Gemini MiCA approval and also the Coinbase EU MiCA license decisions will set crucial precedents for how the Maltese crypto license system operates within the broader European crypto market framework.

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The ongoing regulatory debate surrounding cryptocurrency regulation Europe highlights the challenges of implementing uniform standards across diverse jurisdictions, with both the Coinbase EU MiCA license as well as Gemini MiCA approval serving as test cases for the new framework’s effectiveness.