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A guide to the European Regulation on Markets in Crypto-assets (MiCAR)

The regulation of crypto assets and related services is still not treated uniformly in the European Union and resembles more a patchwork of regulatory fragmentation.


A guide to the MiCAR

Although the fifth Anti-Money Laundering Directive (AMLD5) also covers certain crypto assets under the term “virtual currencies”, it does not provide a harmonised approach – according to a new report by B&B.

As a result of the implementation of the AMLD5, each Member State has created its own regulatory regime for transactions related to “virtual currencies” or crypto assets.

This problem is addressed by the European Commission’s proposal for the Regulation Markets in Crypto-assets (abbreviated as MiCAR). It is currently expected that MiCAR will come into force in 2022 and will be directly applicable in all Member States after an 18-month transition period.

This means that a harmonised set of rules for products and services related to crypto-assets can be expected throughout the European Union in 2024.

The proposal

In September 2020, the European Union further pursued the Digital Finance Strategy with the MiCAR proposal. Both the opportunities and the risks are best addressed in a common regulation for all Member States.

Germany had already gone ahead with the implementation of the fifth Anti-Money Laundering Directive (AMLD5) and had created the crypto custody business as a new regulated financial service.

In addition, Germany enacted an Electronic Securities Act (eWpG), which also covers the crypto sector and offers further opportunities.

The MiCAR proposal aims to regulate these issues at EU level and create legal certainty across Europe. This would enable a larger number of investors to be active in this area and to use distributed ledger technology (DLT).

At the same time, innovation and development are to be promoted. The MiCAR proposal should ensure that financial stability in the EU is guaranteed in the process.


The content of the MiCAR proposal can be divided into three sections:

The authorisation requirements for issuers of crypto-assets and the corresponding obligations for the types of tokens covered by the regulation (asset-referenced tokens, e-money tokens and, as a catchall, crypto-assets).

The second section covers the authorisation requirements for providers of services related to cryptoassets.

The third section deals with the competent authorities and their competences.

Objective: What is being regulated?

According to the current proposal, MiCAR is to apply to all persons who want to issue crypto-assets or provide services related to crypto-assets in the European Union.

The MiCAR proposal is intended to lay down uniform rules on transparency and disclosure requirements for the issuance, offer to the public and the admission to trading of crypto-assets. In addition, there are rules on the authorisation and supervision of crypto-asset service providers and their issuers.

The main focus lies with the issuers of asset-referenced tokens and e-money tokens.

The Regulation intends to regulate the operation, organisation and governance of issuers of asset referenced tokens and e-money tokens and crypto-asset service providers.

There will also be investor protection rules for the issuance, trading, exchange and custody of crypto-assets.

In addition, measures to prevent market abuse are to be included in the Regulation to ensure the integrity of the crypto-assets markets.

To read the full report CLICK HERE


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