The first uniform rules for markets for crypto assets have recently come into force in the European Union. Cryptocurrency providers must now adhere to these rules. On April 20, 2023, the European Parliament passed the «Markets in Crypto-Assets Regulation», MiCAR for short. The Council of the European Union approved the regulation on markets for crypto assets on May 16, 2023. On June 9 last year, it was then published in the Official Journal of the European Union and came into force on June 29, 2023. According to the Deutsche Bundesbank, the MiCAR regulations are applicable at different times. While individual articles have been in force since June 29, 2023, the regulations on asset-referenced crypto assets and e-money tokens relating to Bitcoin and Co. have been applicable since June 30, 2024. Rules regarding the authorisation and ongoing supervision of CASP in Title V as well as all other provisions not directly applicable under Article 149(4) MiCAR shall be applicable from 30 December 2024.
According to BaFin, the aim of MiCAR is to create a harmonised European regulatory framework for crypto-assets that promotes innovation and enables the potential of crypto-assets to be exploited while safeguarding financial stability and investor protection. The aim is to strengthen investor and consumer protection and combat money laundering and terrorist financing.
Licensing obligations
Since this month, licensing requirements for crypto companies have been in force in the EU. They must register with the financial regulator of a European member state. If a MiCA license is granted, it is valid for the entire EU area. In order to obtain a MiCAR license, the following requirements must be met:
- Headquarters of at least one managing director or legal entity in the EU;
- Description of the corporate governance rules of the applicant crypto service provider;
- Evidence of proper and appropriate business organization;
- Internal control mechanisms;
- Secure IT systems;
- Adequate risk management.
Whitepaper
In addition, crypto companies are now required to publish a white paper. The white paper is intended to protect investors and consumers by informing potential customers. Different white papers must be created for different cryptocurrencies. A crypto asset white paper should contain general information about the issuer, the provider or the person applying for the crypto asset to be admitted to trading, the project to be carried out with the capital raised, the public offering of crypto assets or their admission to trading, the rights and obligations associated with the crypto assets, the underlying technology used for these crypto assets and the associated risks, the regulation states.
