The European Securities and Markets Authority (ESMA) has published its conclusive guidance to support member states in their transition to the Markets in Crypto-Assets (MiCA) regulation.
MiCA regulations began rolling out in June 2024, with full implementation required by December 30. The new guidance aims to address lingering uncertainties and assist countries in finalizing their regulatory frameworks before the deadline.
As previously reported, the adoption of MiCA has catalyzed growth in the stablecoin market. However, as of December 10, six EU countries—Belgium, Italy, Poland, Portugal, Luxembourg, and Romania—were reportedly struggling to meet the year-end compliance deadline due to ambiguities in earlier regulatory guidelines.
In its report, the ESMA acknowledged these challenges:
“Stakeholders generally appreciated the clarity of the draft guidelines and the comprehensive approach taken by ESMA. Several respondents highlighted the need for further clarity on specific criteria and conditions, while others expressed concerns about the potential administrative burden the draft guidelines might impose.”
Regulatory Challenges
During the consultation period, member states and industry participants raised concerns about varying interpretations of MiCA’s provisions. The ESMA addressed 12 key issues, focusing primarily on asset classifications and legal usage.
A recurring concern was the risk of inconsistent implementation across the EU due to vague criteria. As the ESMA noted:
“Several respondents highlighted the potential for legal uncertainty due to the scope of the guidelines and the way the conditions and criteria detailed in the guidelines could be understood by NCAs [national competent authorities]. This could result in diverging interpretations across member states.”
To mitigate these risks, the ESMA provided hypothetical scenarios to explain aspects of MiCA regulation. However, it refrained from offering specific examples involving real-world cryptocurrencies, emphasizing that its guidelines are not intended to classify individual digital assets.
Intersection with MiFID II
The report also addressed overlaps between MiCA and the EU’s Markets in Financial Instruments Directive II (MiFID II), originally introduced following the 2008 financial crisis. Member states have called for an updated MiFID II framework to clearly define crypto assets as financial instruments.
In response, the ESMA suggested refining the interpretation of MiFID II rules to improve clarity while maintaining existing definitions. This approach seeks to balance regulatory consistency with the unique characteristics of digital assets.
Further Clarity Needed
Other issues raised by member states included questions about asset transferability, ensuring technological neutrality under current rules, and applying classifications such as “securities,” “derivatives,” and “emission allowances” to crypto assets.
Although this report marks the final guidance ahead of the December 30 deadline, the ESMA emphasized that collaboration with legislators and industry stakeholders will continue. Future efforts will aim to address unresolved questions without altering the legal framework established under MiCA.
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