Cardano Foundation Challenges EU Crypto Rules, Warns More MiCA Regulation Could Hurt Innovation
The Cardano Foundation has called on the European Commission to improve the European Union’s Markets in Crypto-Assets Regulation (MiCA) without unnecessarily expanding its scope, warning that additional rules could increase compliance costs and weaken Europe’s competitiveness in the digital asset industry.
In its response to the European Commission’s public consultation, submitted on September 30, 2026, the Foundation advocated a technology-neutral, risk-based approach that considers the actual functions performed by a business or protocol. The Foundation published its review on October 21, arguing that regulation should reflect economic substance and identifiable risks rather than automatically imposing new obligations because an activity uses blockchain technology.
The consultation covers existing MiCA requirements, including crypto-asset disclosures, stablecoins and crypto-asset service providers, alongside activities such as decentralized finance (DeFi), staking, lending, borrowing and certain non-fungible tokens (NFTs). The Commission is assessing whether the framework remains effective as the market and international regulatory landscape evolve.
Cardano Opposes Expanding MiCA to DeFi and Staking
A central recommendation in Cardano’s response is that regulators should distinguish public, permissionless blockchain infrastructure from financial services provided by identifiable intermediaries. The Foundation argues against creating separate regulatory regimes solely because an activity involves decentralized technology.
The distinction is particularly relevant to staking on Cardano. ADA holders can delegate their stake to support the network’s proof-of-stake consensus mechanism without transferring custody of their assets or locking them. The Foundation says this form of direct participation should be treated differently from intermediated staking services in which a provider holds assets or exercises discretionary control.
Under its proposed approach, regulation should focus on identifiable parties performing regulated functions and exercising meaningful control over assets or transactions. General-purpose blockchain infrastructure, autonomous software and technical access to a network should not automatically qualify as regulated financial services.
The Foundation also wants regulators to preserve clear boundaries between MiCA and existing European financial-services legislation, including the Markets in Financial Instruments Directive II (MiFID II). It argues that an asset’s classification should depend on its substantive characteristics rather than how it is represented technically. Greater clarity is needed for hybrid tokens, assets whose characteristics change over time and inconsistent interpretations between EU member states.
Cardano’s position does not amount to a call for financial activities to be exempt from regulation. Instead, it argues that existing rules should apply where the functions and risks justify them, without creating unnecessary categories or overlapping obligations. The Foundation believes this would provide legal certainty while allowing decentralized infrastructure to operate without requirements designed primarily for traditional intermediaries.
Cardano Seeks Clearer Rules for NFTs, Stablecoins and Tokenized Assets
The response also addresses NFTs, stablecoins and emerging crypto-market activities. On NFTs, the Foundation supports preserving MiCA’s exclusion for genuinely unique, non-fungible assets. It argues that belonging to a collection or sharing certain characteristics should not, by itself, make an NFT fungible. Classification should depend on the asset’s substantive characteristics and whether it is actually interchangeable with others.
The Foundation further argues that subsequent actions by independent third parties, such as fractionalizing an NFT or integrating it into a financial application, should not automatically change the underlying asset’s regulatory classification. It opposes a dedicated regulatory regime for NFT-related services, favoring assessment under existing legislation where applicable.
Prediction markets, perpetual futures and crypto-asset lending should likewise be evaluated according to their economic and legal characteristics, the Foundation says, rather than automatically brought under MiCA. It warns that separate regimes could create overlapping requirements and conflicts with existing EU financial-services laws.
For stablecoins, Cardano recommends clarifying the treatment of global and multi-issuer arrangements and reducing overlaps between MiCA and payment-services legislation. It also calls for environmental sustainability disclosures to better reflect differences between blockchain architectures, rather than applying requirements without regard to how networks operate.
Cross-border consistency is another priority. The Foundation wants more harmonized interpretations across member states and clearer conflict-of-laws rules for tokenized assets, including which national law governs ownership, transfers and third-party rights. It also supports a proportionate approach to access for firms based outside the EU, including preserving genuine reverse solicitation and considering recognition of comparable foreign regulatory frameworks.
The Foundation’s broader warning is that complex rules and high compliance costs can disproportionately burden smaller businesses and emerging projects, while established firms are better equipped to absorb them. As the European Commission reviews MiCA, Cardano is urging policymakers to prioritize clearer definitions, consistent enforcement and proportionate safeguards over expanding regulation. The outcome could influence how DeFi protocols, staking providers, token issuers and other blockchain businesses operate across the European market.
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