MiCA: Crypto-Asset Service Providers and Stablecoins in the EU

The legal basis

The Markets in Crypto-Assets Regulation (Regulation (EU) 2023/1114, "MiCA") creates a harmonised EU framework for crypto-assets that are not already covered by existing financial-services legislation.

Timeline

The rules for asset-referenced tokens (ARTs) and e-money tokens (EMTs) applied from 30 June 2024.

The remaining provisions, including authorisation of crypto-asset service providers (CASPs), applied from 30 December 2024.

Member States could allow firms already operating under national regimes a transitional period ending no later than 1 July 2026; the length chosen differs by Member State.

Who needs authorisation

Firms providing crypto-asset services such as custody and administration, operating a trading platform, exchange of crypto-assets for funds or other crypto-assets, execution or transmission of orders, placing, advice, portfolio management and transfer services must be authorised as a CASP by a national competent authority, unless they are an already-authorised financial entity using the notification route.

An authorised CASP may passport its services across the EU.

Stablecoins

Issuers of EMTs must be authorised as a credit institution or an electronic money institution. Issuers of ARTs need specific authorisation under MiCA. Significant tokens are subject to additional supervision by the European Banking Authority.

Related obligations

The recast Transfer of Funds Regulation (Regulation (EU) 2023/1113) applies the "travel rule" to crypto-asset transfers from 30 December 2024.