Episode Transcript
[00:00:00] Out of Cycle Update While Trump was worried About China, the EU swept in and cleaned up CryptoTalk FM My name is Leister. I am your host giving you an update with the recent dumps that are happening and a possible root cause, at least one root cause of some of the dumps. You may or not have seen what's happening. That's why I want to share it because although it probably doesn't directly affect you, it affects you in an indirect manner. And I want to share it because it may affect you in an indirect manner.
[00:00:31] What happened is that stable coins, a lot of stable coins are under attack. Not really. What happens is that Binance has is en route to delist a number of these stable coins by the end of March. They're doing it because of what's called micro regulations coming out of the eu. One of these stable coins particular I think is of great concern that's being FD USD First Digital USD. I did an update a while back about First Digital USD briefly as relates to another garbage token that had launched and there was a whole bunch of major amounts of money flowing in. I believe it might have been worldcoin. Point is that there's a whole bunch of money flowing that direction via First Digital USD and it seemed like Binance was doing some sort of a giveaway or whatever the F around that garbage token. I also saw ustc which is on the Luna Classic ecosystem, and a couple of select few others, DAI being one of them, where allegedly because of the MICA regulations as it's referred to, these stable coins are not in compliance. And I wanted to talk about the micro regulations. These started or originated in terms of conversations back in about mid 2023, finalized December 30, 2024. And what it's intended to do is to try to create a single standard for crypto regulation across all of the EU members. Whether or not that's going to really play in I don't know. And I will tell you just as a spoiler alert, garbage Vol coins, you know, all your little dogs and cats and monkeys and, and whatever, turtles and everything else, squirrels and all that other garbage is not included in this reg. Those are all considered not compliant by default. So if you want to gamble, roll the dice on all those animal tokens, you're free to do it. Just understand this is talking about ones that are believed to have an actual intent and purpose. MICA stands for Markets in Crypto Assets. That's the stand. That's what it refers to. It's an actual abbreviation. It Stands for markets in crypto assets. It classifies cryptocurrency three ways. 1e money e money is where you have a stable coin that is directly keyword, directly pegged to an actual fiat token such as the EUR or USD, the, the Yen, etc. Asset reference tokens are ones that are backed by, by a group of currencies or commodities or other crypto assets. How does that work?
[00:02:52] As an example, an asset reference token, you might have a token, they actually have this. You might have a token that says we're going to price, you know, 5,000 bitcoin and we're going to tokenize the value of 5,000 bitcoin as a separate token that can be traded. Now why would you do such a thing? Because, because usually the price, entry price for those is lower. The risk is generally lower. The. But there is a consideration for the, for the custodian, whoever's holding those assets to be aware of. That's why they're trying to put some framework around it. And the third category is utility tokens that provide access to a specific service or network. And of course there's not very many true utility tokens out there. But what really caught people's eye specifically on the stable coins, there are certain standards that the stable coins are going to have to meet and this is why the ones I listed, plus others were called out as to be kicked off of binance. First authorization. There's an authorization to be a credit institution or e money institution if you're an issuer of a stable coin. So if you're going to be, let's say the ustc, there is no financial institution behind usdc. It's all smoke and mirrors. We know that DAI has an institution but they're not authorized as a money issuing institution, et cetera and so on. So what they're trying to do is essentially blacklist anybody that does not operate within financial, you know, fiat issuing standards because you'd have to have fiat issuing standards met in order to be compliant with this law from the, from the jump. So they're going after essentially anything that's not a very subset select. I think USDC and a couple of other ones were left out in the, left out in this Reserve requirements are saying strict reserve asset requirements and mandatory stress testing. The stress testing, arguably none of these organizations are subject to stress testing with the exception of USDC and a couple of others. Coinbase of course, so. Or circle rather. So you have to understand that the mandatory stress test is oversight. It's regulatory oversight. You're never gonna get a lot of these garbage stable coins to spin up. You're never gonna get them to subject themselves to that sort of oversight because it goes completely against the spirit of decentralization. Volume caps this was an interesting one quote. To prevent any stablecoin from displacing traditional fiat, Mica imposes transaction volume limits. For example, well known stablecoins like Tether have faced challenges in the EU market due to these stringent requirements. Tether, for example, exited the EU while Circle secured an EMI license in France to issue USDC stop. So the volume, that's an interesting one, right? Transaction limits what they're saying is we're trying to make sure that you're not just transacting in stable coins instead of transacting in fiat. Because we understand that if everybody just leapfrogs and yolos into stable coins and stops transacting in fiat, it's going to crash Fiat currency, which I know there's some of these DJ people out there and that's what they want to do is get rid of Fiat. And they're talking about we're going to go all in on digital currencies and we don't need Fiat anymore.
[00:05:59] That's what that bottom line is talking about. It's saying we're going to put some breaks on this and we're not going to allow you to do that. We want to make sure you're still transacting in fiat even if you're going to use this. So now you guys have to choose. You got to pick your poison. Because what they're doing is they're trying to put something that's going to put some regulatory stability around the industry and make it to where it's safe for the big players, the big mother fathers to get in this business. But in exchange, you are not going to get away from Fiat. You're going to continue using that fiat. And yes, I understand it ain't worth a But they don't care. They still want you to use it is what they're saying. Now here's the icing on the cake. They talked about enhanced protections for issuers and for investors. On the investor side. White paper mandates and this is regardless of stablecoin or otherwise quote, crypto asset issuers must publish detailed white papers that explain the risks, tokenomics and technical specifications of their offerings. Market abuse rules to align crypto markets with traditional finance. MICA prohibits insider trading and market manipulation. No investor compensation. Unlike traditional markets where investor losses might be covered by safety nets, crypto investors under MICA bear the full liability for their investments. Stop. So let me simplify what that's saying the white paper mandates. I mean everybody should be on board. Likes to hear cryptotalk. FM has harped on on for many, many months to years the importance of having a not only a white paper but also a good white paper that breaks down my rubric. Who, what, where, when, how and why. I want to see details in your white paper and if it's crap, I'm going to call you out on it. Mike is supporting what Leister said to be the truth. And this is what I want to hear. Market abuse rules to here's the thing. Prohibits market manipulation. Understand that wash trading is common and consistent in crypto and that's how all these tokens that are about to pre sale and they get you to FOMO and they tell you to go to the telescam and they got all these bots ready to go to create artificial traffic. All that stops under this one, just FYI. So your garbage dog token is not going to go to the moon off of artificial pumps and you're not going to see another Pepe any time of your lifespan. No investor compensation. I love that one. It's flat out saying if you're a gambler, you want to roll the dice, you gonna do that. But it's on you. That means that's all you. That means there is no suing because I lost my whatever the F. And none of that. If you get in, it's all on you. You chose that. You made that decision. It's all on you. Now what is the downside of that? That the downside of that is that that tends to protect people like Manny the rug puller on Saitama. It tends to protect my Koroni over on Safe Boom. It tends to protect the car salesman on Safe Food and all the known scammers out there. It'll protect people like a Ben Armstrong on a bitboy and his Ben coin. It'll protect people like bleeds who tell you to get in those type tokens. It'll tell. It'll protect people like Jake again telling to get into garbage. It protects those people who tell you to get in it because it puts the onus on you to make a smart decision in the first place and not allow those people to influence you to get into garbage. So you've got a choice. This is, I think it's great. I. I'm disappointed that the EU beat Donald Trump to the punch. Unfortunately, Donald Trump was dragging his feet. Focus on other stuff. He did what he had to do. The EU got in front of it and hopefully we have smart regulations like this. But here's what it also means. It means the onus is going to fall on you. You're going to have to make decisions about what risks you're choosing to take and I'm going to recommend that you listen to Lifestyle CryptoTalk FM and tell your friends this guy's trying to tell us to keep safe because we understand it's all on us. The liabilities on us, the risks on us. If we lose money that's on us and he's trying to help protect us rather than telling us to get in the garbage. Or you can continue listening to the garbage out there and all those influencers telling you get into their garbage token and keep getting ripped off or hawk to a girl telling you to spit on them tangs when they ain't worth nothing. It's all on you. It's on you. Hey.
