ESMA Publishes MAR Rules Under MiCA, FCA Hones in on FX Derivatives Markets

The EU financial regulator ESMA is urging national regulators to start implementing the principles of newly-published guidelines to prevent and detect market abuse under MiCA, while the UK’s FCA is considering how to be smarter with data when it comes to monitoring practices in FX derivatives markets.

ESMA has published its guidelines for national competent authorities (NCA), outlining general principles for effective supervision, partly based on its experience under the Market Abuse Regulation and partly on practices specific for crypto assets.

The rules aim to eliminate market abuse in the digital asset space, with consideration for the cross-border nature of the industry and the important role social media plays in the industry. The guidelines require regulators to take a risk-based and proportionate approach and it sets the goal for NCAs “to develop a common supervisory culture specific for crypto assets through an open dialogue with the industry and interactions with other NCAs.”

​​On the same day, Therese Chambers, joint executive director of enforcement and market oversight at the UK’s FCA, delivered a speech at the Market Abuse and Market Manipulation Summit, in which she said the regulator would attempt to use data better for keeping an eye on FX derivatives markets.

“We know some reporting obligations are duplicative. We understand there are challenges specific to certain instruments, like FX. And we understand the burden on some firms may be greater than others,” she said, adding that the FCA will be proportionate in its approach.

“We will also consider how to be smarter and more efficient with other data we receive, such as EMIR reports, for monitoring derivatives such as FX,” Chambers added.