Europe Prepares New DeFi Regulation by 2026, Expanding Beyond MiCA Framework

The European Union is tightening its regulatory grip on cryptocurrencies, with a new wave of DeFi-specific rules slated for 2026. While MiCA currently governs tokens and centralized providers, Brussels now aims to address the legislative gray area surrounding decentralized finance. This MOVE signals a broader institutional push to bring DeFi under regulatory oversight.

Legal uncertainty looms as the EU acknowledges the challenge of defining "fully decentralized" platforms. The proposed framework could impose alarming obligations on developers and protocols, potentially treating DeFi as an institutional threat. Market participants are bracing for impact as these regulations may reinterpret how smart contracts and decentralized applications operate under law.

Unlike the abandoned MiCA II proposal, this approach involves targeted legislative revisions rather than comprehensive reform. The coming years will test whether Europe can balance innovation with its trademark regulatory zeal—a development that could set global precedents for DeFi governance.