The European Union (EU) has always been at the forefront of enacting legislation to protect consumers and stimulate financial innovation embodied by protocols like Stellar. In September 2020, the European Commission introduced the Markets in Crypto Assets Regulation (MiCA) to bring clarity and oversight to the rapidly evolving digital asset market.
The objectives of the MiCA regulation which is set to launch by the end of 2024 include ensuring legal certainty, encouraging innovation and fair competition, safeguarding consumers, investors, and market integrity, as well as ensuring financial stability.
As highlighted in a recent report, Stellar (XLM), a non-profit blockchain platform, has emerged as a highly sought-after protocol due to its dedication to compliance and its potential to change the European financial environment that aligns with the MiCA regulation.
Core Stellar Attributes
Key features of Stellar’s compliance with MiCA regulations include Stellar Ecosystem Proposal (SEP) 0012, commonly known as the Know Your Customer (KYC) API. While MiCA highlights the necessity of adhering to KYC requirements, Stellar has taken aggressive steps to comply with these requirements.
Through Stellar’s KYC API, customers can upload their KYC information to Anchors and other services that bridge into Stellar. This enables customers to enter their KYC information once and utilize it across several services without having to retype it manually. The KYC API also supports picture and binary data, in addition to the set of fields provided in SEP-9, and SEP-10 authentication.
Additionally, Stellar’s underlying technology is designed to handle high transaction volumes efficiently. As MiCA seeks to establish a thriving digital asset market in Europe, Stellar’s scalability becomes a key advantage.