Venture capital firm Paradigm has submitted a response to the European Securities and Markets Authority (ESMA) regarding the enforcement of abuse prevention in the crypto assets market. Paradigm raised concerns about ESMA's approach to market abuse, particularly the issue of Maximum Extractable Value (MEV). The firm argued that ESMA's regulation of base-layer blockchain microstructure is flawed and could hinder innovation in the sector. Paradigm emphasized the need for a better understanding of MEV and called for nuanced application of regulations in the crypto space. The firm highlighted the importance of encouraging industry innovation to enhance consumer welfare without imposing restrictive design constraints. While addressing the challenges posed by MEV misuse, Paradigm acknowledged the ongoing efforts to address these issues. The article also touches on the complexities of regulating automated market makers in the crypto industry. Read more AI-generated news on: https://app.chaingpt.org/news