The European Central Bank (ECB) has published a document considering the possibility of including decentralized autonomous organizations (DAOs) within the MiCA regulatory framework. This decision could radically change the DeFi landscape in Europe.
The MiCA (Markets in Crypto-Assets) regulation has already created serious difficulties for centralized crypto exchanges. Now the regulator’s attention has shifted to DAOs, which until now were considered an exception to the rules.
The ECB analyzed four protocols: Aave, MakerDAO, Ampleforth, and Uniswap.
Key findings:
- In each project, the 100 largest holders own more than 80% of governance tokens.
- Exchanges like Binance are counted as a single holder, even though they represent millions of clients.
- The ECB believes such concentration of power calls into question the reality of decentralization.
ECB proposals:
- Include DAOs within the MiCA framework.
- Strengthen traceability of voting participants.
- Consider hybrid models or the creation of legal entities for DAOs.
Consequences for DeFi if proposals are implemented:
- DAOs will lose their exemption from MiCA.
- They will have to meet the same requirements as centralized exchanges: strict reporting, legal registration, and regulatory oversight.
- This could paralyze the development of DeFi in Europe.
Conclusion:
The ECB is essentially questioning the very idea of decentralization in DeFi. If the proposals are implemented, DAOs in Europe will face heavy regulation, which could sharply reduce innovation and freedom in the sector.