Cardano Foundation Urges EU to Exclude DeFi From MiCA

The Cardano Foundation submitted a 19-page response to the European Commission's MiCA-review consultation, calling on EU policymakers to exclude decentralized finance protocols and staking activities from any extension of the Markets in Crypto-Assets framework, arguing that applying intermediary-style rules to non-custodial, protocol-level participation would misrepresent how those activities actually function and could push innovation outside Europe. Cardano Foundation asks the EU to keep DeFi and staking outside extended MiCA rules The Cardano Foundation filed its formal response to the European Commission's MiCA-review consultation on September 30, according to Cointelegraph reporting on the submission. The Foundation urged the Commission not to create new standalone regulatory categories for DeFi and staking, a position that puts it in direct tension with part of the European Securities and Markets Authority's own review recommendations. For related coverage, see Why Is Cardano (ADA) Price Surging Today?. MiCA consultation submission 19 pages Reported length of the Cardano Foundation's response to the European Commission's MiCA-review consultation. The core argument in the Foundation's submission is that regulation should track functions and risks rather than the underlying technology. Per the independently reported summary, the Foundation drew a clear boundary between direct network participation, where a user interacts with a protocol without handing custody or control to any third party, and intermediary services, where a firm sits between the user and the network. Only the latter, in the Foundation's view, warrants MiCA-style licensing obligations. For related coverage, see Why Is Cardano (ADA) Price Surging Today? Key Drivers. That framing has direct consequences for Cardano's own ecosystem. ADA holders who delegate stake to a pool directly, without using a custodial platform, would fall under the "direct participation" category the Foundation wants left unregulated, while an exchange offering a managed staking product would sit clearly on the intermediary side and remain subject to oversight. For related coverage, see Why Is Cardano (ADA) Price Surging Today? Key Drivers. Why the MiCA debate matters for DeFi and staking MiCA, which entered full application for crypto-asset service providers across the EU in December 2024, established licensing, disclosure, and consumer-protection obligations for firms dealing in crypto assets. The framework was deliberately scoped to exclude genuinely decentralized protocols at launch, but the European Commission's ongoing review is assessing whether that exclusion should remain or whether DeFi and staking merit their own regulatory tier. Staking on proof-of-stake networks such as Cardano is the mechanism by which validators earn rewards for securing the blockchain; noncustodial delegation lets token holders participate in that process without surrendering control of their assets. DeFi protocols, meanwhile, allow users to lend, borrow, and trade through self-executing smart contracts rather than through licensed intermediaries.