Cardano to EU: Don’t Let MiCA Chase DeFi Down the Rabbit Hole

The Cardano Foundation has urged the European Commission not to expand the European Union’s Markets in Crypto Assets Regulation (MiCA) to decentralized finance (DeFi), staking or direct participation in decentralized networks, setting out its position in a 19-page submission dated Wednesday, Sept. 30, 2026.

In the document, published in full Oct. 21, the foundation said regulation should distinguish between people taking part directly in decentralized networks and intermediaries providing financial services, particularly when those services involve custody or control of users’ assets. “Regulation should follow the substance of an activity, the functions performed, and the risks created, not the technology through which it is conducted,” the foundation wrote.

Cardano users can delegate their native ADA (ADA) tokens to help secure the network without surrendering custody or locking their tokens, according to the foundation, which argued that this participation differs from staking services operated by intermediaries. It also called for clearer boundaries between MiCA and existing financial laws, warning that overlapping requirements and inconsistent interpretations among EU member states could create uncertainty for crypto businesses.

The proposal comes as regulators consider expanded crypto oversight. In September, the European Securities and Markets Authority (ESMA) recommended additional safeguards for staking, lending and borrowing and a new regulated service category for firms providing access to DeFi protocols. Separately, the Cardano Foundation joined five other blockchain organizations in an Oct. 20 letter urging the US Securities and Exchange Commission (SEC) to formally recognize digital commodities as non-securities under its proposed crypto framework.