The Cardano response argues that an asset’s classification should depend on its substantive characteristics rather than how it is technically represented. At the same time, the Foundation highlighted the need for greater clarity around hybrid tokens, changing asset characteristics, and differing interpretations among EU Member States.
The submission states that improving legal certainty should not require expanding regulatory scope or creating unnecessary overlaps between frameworks. For the Cardano ecosystem, the consultation presents an opportunity to address areas where market participants may face uncertainty when determining which set of rules applies to specific crypto-assets.
Focus on DeFi, Staking, and Network Participation
A major portion of the Cardano submission examines decentralized finance, staking, and participation in public blockchain infrastructure. The consultation seeks feedback on whether activities conducted through decentralized networks should be regulated differently from traditional financial services.
The Foundation recommends against introducing separate regulatory regimes simply because decentralized technology is involved. Instead, the Cardano response advocates regulating identifiable parties that perform controlled functions or exercise meaningful authority over assets and transactions.
Staking receives particular attention in the submission. The Foundation notes that Cardano users can delegate stake to support network consensus and security without giving up custody of their assets or locking them. Because of this structure, the Foundation argues that direct protocol-level participation should be distinguished from staking services that involve custody or discretionary management.
Opposition to Expanding MiCAR’s Scope
The Cardano Foundation also expressed opposition to expanding MiCAR’s regulatory perimeter through new standalone frameworks for DeFi, staking, or other forms of protocol-level participation. According to the response, regulation should continue to focus on actual functions performed and risks created. The Cardano position maintains that existing frameworks should be applied where appropriate while avoiding unnecessary restrictions on decentralized infrastructure. The Foundation believes this approach would support legal certainty, preserve innovation, and allow participants across the Cardano network to engage directly with public blockchain systems without creating additional regulatory categories.
