The Markets in Crypto-Assets Regulation (MiCA) entered into full application in December 2024, marking the most significant shift in European digital asset regulation since PSD2.
MiCA establishes a harmonised regulatory framework across all 27 EU Member States, replacing the fragmented patchwork of national approaches.
Licensing and Authorisation
Under MiCA, any entity providing crypto-asset services must obtain authorisation as a CASP. PSPs already authorised under PSD2 benefit from a simplified process but are not exempt from MiCA's substantive requirements.
National competent authorities have taken varying approaches to the transitional period. PSPs operating across borders must track these differences carefully.
Capital and Prudential Requirements
MiCA imposes minimum capital requirements varying by service type: EUR 125,000 for transfer services, EUR 150,000 for custody. National authorities may impose additional capital buffers.
MiCA also requires CASPs to maintain professional indemnity insurance or comparable guarantees.
Operational Resilience and Governance
CASPs must implement robust governance arrangements including clear organisational structures, effective risk management, internal controls and business continuity plans.
Board members must demonstrate adequate knowledge and experience in crypto-asset markets.
Consumer Protection
PSPs must provide clear, fair and not misleading information to clients. Marketing must include risk warnings. A 14-day right of withdrawal applies for direct purchases.
Cross-Border Passporting
Once authorised in one EU Member State, a CASP can provide services across all Member States — fundamentally changing the economics of European expansion.
Conclusion
MiCA provides legal certainty and market access. PSPs that invest early will leverage the passporting mechanism and build client trust.
At Advisorn, we support PSPs throughout the MiCA compliance journey — from regulatory mapping to ongoing monitoring.
For questions about this topic, contact us.
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