What is MiCA: New Regulation Rules for Cryptocurrency Companies in the EU

MiCA (Market for Crypto Assets) is an EU regulation that sets out clear rules for cryptocurrency businesses, ensuring transparency and investor protection. It harmonized the licensing requirements for Crypto Asset Service Providers (CASP) across all EU member states. The Regulation on Crypto Asset Markets, adopted in June 2023, sets out uniform rules for the 27 EU countries. It applies to Crypto Asset Service Providers (CASPs) that offer crypto asset trading, custody, exchange and issuance services. MiCA has strengthened transparency, capital requirements and investor protection, affecting more than 10000 cryptocurrency companies in the EU.

Who needs a MiCA license? Exchanges, wallets and more

CASP, which includes cryptocurrency exchanges, wallets and token issuers, must obtain an operating license issued by the state regulator. They must comply with anti-money laundering standards, risk disclosure and security requirements. With more than € 1 trillion million of crypto assets worldwide, MiCA enhances trust and legal certainty in the market.

Role of national authorities and ESMA

MiCA cryptocurrency licenses in the EU are issued by national financial regulators, which review applications and ensure compliance. The European Securities and Markets Authority (ESMA) oversees market regulation, provides guidance and ensures a uniform approach across all member states.

Deadline 2025: Why CASP must be prepared for MiCA compliance

MiCA will come into full force in December 2024, with a transition period until 2025. CASPs that fail to comply will face fines or restrictions, while licensed firms will be granted EU-wide market access. MiCA is expected to promote institutional investment and create a more secure and transparent crypto environment in Europe.

Learn about the MiCA licensing process with our legal team

MiCA Compliance Framework for CASP

The Crypto Asset Market Regulation establishes a structured framework for the EU's CASP. To ensure market integrity, investor protection and financial stability, MiCA has divided CASP into three regulatory levels based on its business activities, risk exposure and compliance obligations. Each level has specific licensing, operational and financial requirements, including minimum equity, AML/KYC compliance, risk management and reporting responsibilities.

Type 1 CASP-Essential services (lower regulatory requirements)

These CASPs provide advisory and intermediary services with minimal direct contact with client funds. They have low capital requirements (€ 50000) and must meet core compliance obligations, including licensing, transparency and customer protection. Class 1 CASP includes

Execute orders on behalf of clients Placing crypto assets Providing crypto asset transfer services Receiving and transmitting crypto asset orders Providing advice on crypto assets Portfolio management of crypto assets

Type 2 CASP-Custody and Exchange Services (Medium Regulatory Requirement)

This category includes CASPs that hold, store, or facilitate the exchange of crypto assets, which pose higher financial and operational risks. These entities must comply with stricter AML/KYC obligations, enhanced security measures and liquidity controls, and must also meet higher capital requirements (€ 125000). Class 2 CASP includes

Custody and management of crypto-assets Exchange of crypto-assets for funds (cryptocurrency-to-non-currency transactions) Exchange of crypto-assets for other crypto-assets (cryptocurrency-to-cryptocurrency transactions)

Class 3 CASP-Trading Platforms (Maximum Regulatory Requirements)

Due to its systemic importance and high trading volume, CASP, which operates cryptocurrency trading platforms, faces the most stringent regulatory requirements. These platforms must meet a wide range of risk management, market regulation, operational resilience and liquidity standards, as well as a minimum capital requirement of € 150000. Class 3 CASP includes

Operating a Crypto Asset Trading Platform

Comply with MiCA's general requirements for all CASPs

Regardless of classification, all CASPs must comply with the following MiCA core obligations:

Licensing-obtaining authorization from the relevant national financial authorities of the European Union.

AML/KYC compliance-implement sound anti-money laundering (AML) and know your customer (KYC) policies.

Risk Management-Establishing an internal framework to reduce financial, liquidity and operational risks.

Consumer protection-ensuring fair pricing, clear risk disclosure and safe custody of assets.

Reporting obligations-submit financial reports regularly and comply with regulatory audits.

Operational Resilience-Maintain strong cybersecurity, fraud prevention, and market integrity controls.

MiCA's three-tier system provides a structured approach to cryptocurrency regulation, ensuring that CASP meets appropriate financial, security and compliance standards based on its business model and risk level. With full implementation in December 2024, CASP should evaluate its classification, regulatory obligations and compliance strategies to obtain a cryptocurrency license and operate legally in the EU cryptocurrency market.

Apply for a CASP license under MiCA

For Crypto Asset Service Providers (CASP) who want to operate legally in the EU market, obtaining a MiCA license is a crucial step. The licensing process includes regulatory approvals, compliance verification, and business assessments by national financial authorities. Here are the key steps to getting a cryptocurrency license:

Preparation before application

Before submitting an application, the CASP must

Define its business model and determine its regulatory classification (Class 1, Class 2 or Class 3).

Ensure compliance with AML/KYC policies, risk management frameworks and governance structures.

Prepare necessary company documents including business plans, security protocols and internal policies.

Submission of permit application

CASP submits an application to the national financial authorities of the EU country applying for a licence. The application must include

Proof that the company's registration details and legal structure meet the minimum share capital requirements (€ 50,000, € 125,000 or € 150,000.

Detailed AML/KYC procedures

Risk Assessment Report and Security Protocol Business Continuity and Operations Recovery Plan

Regulatory Review and Approval

Regulators assess the financial stability, governance and compliance framework of the CASP. The review process typically includes

Perform due diligence on company owners, directors and key personnel

Assess internal policies and risk controls Assess financial sustainability and liquidity requirements Cybersecurity and fraud prevention audits

Licensing and Compliance Monitoring

If the CASP meets all the requirements, the regulator issues a MiCA license, allowing the company to operate in all 27 EU member states. Post-licence obligations include

Periodic financial reporting and auditing Continued compliance with AML/KYC standards Continued compliance with MiCA regulations and ESMA guidelines

Obtaining a MiCA license ensures legitimate market access, investor trust, and long-term business growth for the EU crypto industry.

Why choose us?

Obtaining a MiCA license requires expertise in regulations, compliance and legal procedures. Our team can provide end-to-end support to ensure that the licensing process is smooth and fully compliant with ESMA and national financial authorities. We are your best partner:

Proven Regulatory Expertise

We focus on crypto compliance and licensing, helping CASP navigate the MiCA regulations and meet all legal requirements.

Full Licensing Support Services

From regulatory consultation and application preparation to document drafting and communication with the competent authorities, we are responsible for the entire licensing process.

Tailored Compliance Solutions

We tailor policies, AML/KYC frameworks and risk management strategies to meet your business needs and ensure regulatory approvals.

Direct contact with regulators

We liaise with national finance authorities to ensure that the approval process is transparent and efficient and that delays are minimized.

Ongoing compliance assistance

Our support doesn't stop once you're licensed-we'll provide ongoing compliance monitoring, audits, and regulatory updates to align your business with MiCA.

With our professional guidance, extensive regulatory knowledge and practical approach, we can help CASP efficiently obtain MiCA licenses and operate legally in the EU market.