Crypto Industry Struggles With MiCA Compliance 100 Days In

One hundred days after the Markets in Crypto-Assets (MiCA) framework took effect, the majority of the crypto industry is still in the process of adapting to the new regulations. The low number of authorized entities highlights the challenges faced by the sector in meeting MiCA's compliance requirements.

According to Patrick Hansen, an executive at Circle, only 11 stablecoin issuers and 15 crypto-asset service providers (CASPs) have received authorization from the European Securities and Markets Authority (ESMA). This data underscores the ongoing struggle within the industry to comply with the new regulatory standards.

Hansen pointed out that without a MiCA license, crypto firms are unable to offer their services across the 30 countries in the European Economic Area (EEA). This restriction is prompting companies to expedite their licensing efforts to ensure they can operate legally within the region.

However, there are notable gaps in the authorization process. For instance, no asset-referenced token (ART) issuers have been authorized yet. Additionally, regulators have received only about 25 white papers for digital assets that do not fall under EMT or ART classifications, which includes large-cap tokens such as Bitcoin and Ethereum.

As enforcement of MiCA increases, Italy’s financial authority, CONSOB, has added 15 names to its list of non-compliant entities. This move reflects the growing scrutiny and enforcement actions under the new regulatory framework.

Since MiCA took effect, 11 stablecoin issuers from six EU countries have been approved to issue e-money tokens (EMTs). Regulators have authorized 16 EMTs, with 10 pegged to the euro and six to the US dollar. The approved entities include Circle (issuer of USDC), Banking Circle, Fiat Republic, Quantoz Payments, Membrane Finance, Salvus, Societe Generale, StablR, Stablemint, and Schuman Financial.

Tether, the issuer of the world’s largest stablecoin USDT, is notably absent from the list of approved stablecoin issuers. Its failure to comply with MiCA standards has resulted in delistings from several EU-based exchanges. Tether has responded by promoting its Handron platform and investment in Quantoz Payments as its strategy to address regulatory challenges.

On the CASP front, ESMA has listed 15 authorized providers, including major crypto platforms like Crypto.com, OKX, Bitpanda, eToro, and Crypto Finance, as well as traditional financial institutions like BBVA, Clearstream, and Flatex. Some previously listed firms, such as MoonPay and Hidden Road, no longer appear on the registry, which could indicate changes in their status or ongoing regulatory review.

Germany currently leads the region with six licensed CASPs, followed by Malta with five. This distribution reflects the varying levels of regulatory readiness and compliance efforts across different EU countries.