Major Developments in Crypto Market Today

Need to know what happened in crypto today? Here is the latest news on daily trends and events impacting Bitcoin price, blockchain, DeFi, NFTs, Web3, and crypto regulation. Today in crypto, the European Securities and Markets Authority (ESMA) has confirmed to Cointelegraph that the European Union’s Markets in Crypto-Assets Regulation (MiCA) does not explicitly ban non-compliant stablecoin custody and transfers. Additionally, the US Senate voted to kill the IRS’ DeFi broker rule, and more than $1 billion worth of derivatives were liquidated on March 4 due to fears of a trade war.

ESMA Clarifies MiCA Regulations

The European Securities and Markets Authority (ESMA) has clarified that custody and transfer services for stablecoins that do not comply with the Markets in Crypto-Assets Regulation (MiCA) are not prohibited. This adds to the ongoing uncertainty surrounding their classification and use. Despite removing the affected tokens for trading, Binance stated it will continue to support deposits and withdrawals of non-MiCA-compliant stablecoins after the delisting on March 31.

According to ESMA, a key regulatory body overseeing MiCA compliance in Europe, providing custody and transfer services for non-compliant stablecoins does not violate the new European cryptocurrency laws. A spokesperson for the ESMA told Cointelegraph on March 4, “Under MiCA, custody and transfer services do not in themselves constitute an ‘offering to the public’ or ‘seeking admission to trading’ of non-compliant asset-reference tokens or e-money tokens.”

Guidelines for Crypto Asset Service Providers

Although the ESMA acknowledged that deposits and withdrawals of non-MiCA-compliant stablecoins are not prohibited, it stressed that European crypto asset service providers (CASPs) should “prioritize restricting services that facilitate the acquisition” of such assets by January 17, 2025.

US Senate Votes Against IRS DeFi Broker Rule

In a significant move, the US Senate on March 4 voted 70 to 27 to reject a rule that would require decentralized finance (DeFi) protocols to report to the Internal Revenue Service (IRS). This Biden-era rule aimed to expand existing IRS reporting requirements to include decentralized exchanges and require brokers to disclose gross proceeds from crypto sales, including information regarding taxpayers involved in the transactions. The resolution now moves to the House, where it will need to be passed before being sent to President Donald Trump.

David Sacks, the White House’s AI and crypto czar, has expressed support for the decision. Eli Cohen, general counsel of the RWA tokenizing platform Centrifuge, commented that the rule never made “any sense and was unworkable in practice.”

Market Reactions and Liquidations

More than 87% of liquidations came from long positions after a volatile start to March that saw double-digit losses on March 4, erasing similarly large gains from only days earlier. On March 4, US President Donald Trump imposed 25% tariffs against Canada and Mexico, the United States’ largest trading partners, which sent the S&P 500 stock index down nearly 2% in morning trading.

Bitcoin experienced a significant drop after touching highs of around $93,000 on March 3, according to data from Google Finance. Other cryptocurrencies such as Ether and Solana fell even further, dropping by around 12% and 20%, respectively. This drawdown was a bait-and-switch for traders who had turned optimistic after Trump hinted at plans on March 2 to create a US crypto reserve holding tokens ranging from BTC and ETH.