ESMA and the European Commission publish guidance on non-MiCA compliant ARTs and EMTs (stablecoins)

News Corporate Finance & M&A Guidance

Date: 17th Jan, 2025 Source: European Securities and Markets Authority Country: European Union Original Source

Brief

"On 17/01/2025, the European Securities and Markets Authority issued an update regarding ESMA and the European Commission publish guidance on non-MiCA compliant ARTs and EMTs (stablecoins). The statement provides clarity on how and by when Crypto-asset service providers are expected to comply with MiCA requirements. National Competent Authorities are expected to ensure compliance by the end of Q1 2025, facilitating coordinated actions at the national level."

The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, published today a statement reinforcing the position related to the offer of ARTs and EMTs (also known as stablecoins) in the EU under Market in Crypto Assets regulation (MiCA).

The statement provides guidance on how and under which timeline CASPs are expected to comply with the requirements of Titles III and IV of MiCA, as clarified in the European Commission Q&A. In particular, National Competent Authorities (NCAs) are expected to ensure compliance by CASPs regarding non-compliant ARTs or EMTs as soon as possible, and no later than the end of Q1 2025. With the statement ESMA aims to facilitate coordinated actions at the national level and avoid potential disruptions.

The European Commission have also delivered a Q&A, providing guidance on the obligations contained in titles III and IV of MiCA and how these obligations should apply to crypto assets service providers (CASPs).

The Q&A clarifies that certain crypto-asset services may constitute an offer to the public or an admission to trading in the EU and should therefore comply with titles III and IV of MiCA.

Further information:
Cristina Bonillo
Senior Communications Officer press@esma.europa.eu

Highlights content goes here...

Purpose

The European Securities and Markets Authority (ESMA) published a statement to provide guidance on the compliance timeline for Crypto-Asset Service Providers (CASP) with the requirements of Titles III and IV of the Market in Crypto Assets regulation (MiCA). The purpose of this statement is to facilitate coordinated actions at the national level, avoid potential disruptions, and ensure that CASPs comply with the non-compliant Alternative Repayment Tokens (ARTs) or Electronic Money Tokens (EMTs) as soon as possible, but no later than the end of Q1 2025.

Effects on Industry

The ESMA statement is expected to have a significant impact on the crypto-asset industry. CASPs will need to comply with the requirements of Titles III and IV of MiCA, which include obligations such as registration, authorization, and ongoing supervision. This compliance requirement may lead to changes in business practices, increased regulatory burden, and potential costs for CASPs. Furthermore, the ESMA statement aims to prevent potential disruptions in the market by ensuring that non-compliant ARTs or EMTs are removed from circulation.

Relevant Stakeholders

The relevant stakeholders affected by this update include:

Crypto-Asset Service Providers (CASP)

Alternative Repayment Tokens (ARTs) and Electronic Money Tokens (EMTs) issuers

National Competent Authorities (NCAs)

The European Commission

EU citizens who use or invest in ARTs or EMTs

These stakeholders will need to take note of the compliance timeline and requirements outlined in the ESMA statement.

Next Steps

To comply with this update, CASPs are expected to:

Comply with ongoing supervision and reporting requirements

Remove non-compliant ARTs or EMTs from circulation by the end of Q1 2025

CASP should review the ESMA statement, the European Commission Q&A, and consult with relevant authorities to ensure compliance with MiCA regulations.

Any Other Relevant Information

The ESMA statement provides guidance on how CASPs can comply with the requirements of Titles III and IV of MiCA. The European Commission Q&A clarifies the obligations contained in these titles and how they apply to crypto-assets service providers. This information is crucial for CASPs to ensure compliance with EU regulations and avoid potential disruptions in the market.

European Securities and Markets Authority

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