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MiCA Q&A Updates: Key Points & Firm Implications

The European Securities and Markets Authority (ESMA) has released a series of Q&A updates regarding the Markets in Crypto-Assets (MiCA) regulation, providing further clarity on key aspects of the framework. These updates have significant implications for crypto-asset service providers (CASPs) and other stakeholders in the crypto industry.


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Key Takeaways:


  • Staking Services: While MiCA doesn't explicitly regulate staking, staking-as-a-service falls under its scope as an ancillary service to custody. CASPs offering staking must be authorised for custody services and adhere to relevant requirements.

  • Grandfathering Clause: Existing entities providing crypto-asset services under national AML/CFT laws before December 30, 2024, can benefit from a transitional period to continue operations while seeking MiCA authorisation. However, this benefit doesn't extend to entities that were only registered, not fully authorised, under national laws.

  • Article 60 Notifications: Financial entities providing crypto-asset services before the MiCA deadline can utilise the transitional provision, even without seeking authorisation. However, they must notify their home Member State's competent authority.

  • Crypto-Asset Transfers: Even if part of another crypto-asset service, all transfers are considered separate services under MiCA and require authorisation. Firms must adhere to Article 82 requirements and ESMA guidelines for secure transfers.

  • Transition Period Deadline: Entities failing to obtain MiCA authorisation by the end of the transition period must cease operations. Those not seeking authorisation should plan an orderly wind-down to minimise client impact.


Firm Implications:


  • Staking Service Providers: Ensure authorisation for custody services and compliance with MiCA requirements, including client consent for staking.

  • Existing CASPs: If registered but not authorised under national laws, initiate the complete MiCA authorisation process promptly.

  • Financial Entities under Article 60: Notify the competent authority and consider seeking authorisation to benefit from passporting.

  • All CASPs: Understand that all crypto-asset transfers fall under MiCA's regulatory scope and require authorisation and compliance.

  • Entities Failing to Obtain Authorisation: Cease operations by the end of the transition period or face regulatory action. Develop wind-down plans to protect clients.


These updates emphasise the importance of proactive compliance with MiCA for all entities involved in crypto-asset services. The transitional provisions provide some flexibility for existing players, but the clock is ticking for them to secure authorisation or exit the market.



 
 

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