Trends in EU Crypto Regulation: Understanding MiCA

The European Union has established uniform rules for regulating digital assets Markets in Crypto-Assets (MiCA). MiCA aims to protect consumers and investors, and create transparency and stability in the industry. The law allows you to create effective corporate solutions for crypto exchangers, cryptocurrency exchanges, ICOs and blockchain startups.

What cryptocurrencies does it apply to?

• Asset Reference Token (ART) is a token that provides a stable price based on the value of several fiat currencies, goods, crypto assets or a combination of such assets;
• E-money Token (EMT) – electronic surrogates of coins and banknotes. The key characteristic is the security of fiat currency, which is legal tender.
• Utility tokens are crypto-assets designed to provide access to goods and services of the issuer.

Who does MiCA apply to?

The law defines crypto asset service providers (CASPs) as persons who provide one or more asset-related services to third parties on a professional basis. The MiCA provisions apply to most types of crypto asset services in the EU market. These include:

• cryptocurrency exchangers for legal tender fiat currency or other digital assets;
• custodial platforms;
• platforms for crypto trading;
• crypto asset consulting firms and crypto portfolio managers.

What are the requirements for CASP?

• registration of an office in one of the EU member states;
• obtaining service provider authorization;
• compliance with organizational and reputational requirements, as well as standards for the storage of crypto assets;
• availability of a Know Your Customer (KYC) system, record keeping and monitoring to prevent illegal activities;
• minimum authorized capital from 50 thousand euros to 150 thousand euros, depending on the services provided.

When will MiCA be applied?

The law came into force in July 2023. Most of the provisions will begin to be applied in practice from mid-2024: rules for stablecoins from June 30, exchange rules from December 30, 2024.

How to integrate crypto business into the EU legal framework?

If you are interested in obtaining a cryptocurrency license and integrating your business into the EU legal framework, contact the specialists of Crypto Legal Services.