Cardano Foundation Urges Targeted EU MiCA Rules for DeFi
The Cardano Foundation is urging the EU to apply MiCA and other financial rules according to crypto services’ functions and the degree of control they exercise over users’ assets, rather than imposing blanket rules on decentralised technology. Its legal team explained the position in an article published on October 21, following a submission to the European Commission’s MiCA review on September 30.
The foundation says custodial services and intermediaries that exercise discretion over customer assets should be treated differently from non-custodial activities, such as delegating ADA to secure the Cardano network, or software that simply provides access to a public blockchain. It also calls for clearer rules on DeFi, staking, lending, stablecoins, hybrid tokens and overlaps between MiCA and other EU financial laws. The foundation argues that ADA delegation does not transfer custody or require holders to lock their tokens.
The submission is a policy proposal, not an adopted law or binding exemption. It comes as the European Securities and Markets Authority considers possible safeguards for staking, lending and borrowing, alongside a regulated category for firms providing access to DeFi protocols. The outcome could affect compliance costs and how crypto services operate in Europe, with implications for Cardano’s staking model and permissionless infrastructure.
Neutral
The news is a regulatory position and not a change in law, so it does not directly alter ADA’s utility, supply or network operations. In the short term, the foundation’s proposal may draw attention to Cardano’s non-custodial staking model, but any ADA price response is likely to depend more on broader market conditions and whether traders see a credible path to regulatory clarity. The proposal itself is not a confirmed exemption and does not remove compliance uncertainty.
Over the longer term, rules that distinguish direct participation in decentralised networks from custodial or intermediary services could support clearer conditions for Cardano staking and ecosystem development in Europe. Conversely, overlapping or restrictive requirements could increase compliance costs or limit access to services. As the outcome remains undecided and the submission is advocacy rather than binding policy, the likely direct effect on ADA is neutral; traders may monitor future EU and ESMA decisions for a clearer catalyst.