The Cardano Foundation urged the European Union not to implement new standalone regulations for decentralized finance and staking, submitting a 19-page position paper to the European Commission on Sept. 30.
The foundation argued that existing financial laws should apply to crypto activities based on their functions and inherent risks, not the underlying technology. It called specifically for regulatory distinction between direct participation in decentralized networks and financial services provided by intermediaries.
Cardano's native staking model exemplifies this distinction. ADA holders delegate tokens to secure the network while retaining custody—no intermediary locks or controls the assets. The foundation argued this non-custodial participation differs materially from staking-as-a-service offerings operated by intermediaries.
The submission flagged overlapping requirements between the EU's Markets in Crypto Assets Regulation (MiCA) and existing financial laws as a source of regulatory uncertainty for crypto businesses across the bloc. Inconsistent interpretations across member states compound the problem, the foundation said.
The position follows recent moves by EU regulators to expand oversight. In September, the European Securities and Markets Authority recommended additional safeguards for staking, lending and borrowing activities, and proposed a new regulated service category for firms providing access to DeFi protocols.
The Cardano Foundation has also pursued regulatory clarity in the United States. It joined five other blockchain organizations in an Oct. 20 letter to the SEC urging formal recognition of digital commodities as non-securities under a proposed crypto framework.
