The European Union has agreed on rules for regulating crypto assets, which are expected to come into force at the end of 2023.
The new law, known as markets in crypto assets (MiCA), was agreed by representatives from the EU states and the European Parliament.
"Today, we put order in the Wild West of crypto assets and set clear rules for a harmonised market," said Stefan Berger, the centre right lawmaker who led negotiations on behalf of the parliament.
MiCA will be the first regulation for crypto assets globally and will contain strong measures to guard against market abuse and manipulation, according to Ernest Urtasun, a Green Party member in the European Parliament.
EU states will be the main regulators of crypto companies, although watchdog ESMA will have powers to step in if investor protection or financial stability is threatened, said Urtasun.
One of the regulations will be a ‘crypto passport’, according to Reuters, which will give the issuers of crypto assets a licence to serve clients across the EU from a single base.
Crypto assets came under pressure after the collapse of TerraUSD and luna tokens last month, both of which lost nearly all their value.
Bitcoin, and cryptocurrencies in general, have been in months of decline, with the largest coin by market cap losing 60% of its value in the year so far, and 70% since its all-time high of US$67,000 in November.
The UK and the US, two major crypto centres, have yet to approve similar regulation.