MiCA Implementation
European Union member states are gearing up to enforce MiCA, the landmark crypto law that mandates national regulators to license and supervise service providers. Although MiCA is an EU-level regulation, nations can implement slightly different technical standards, which crypto firms should monitor closely, policy watchers say.
The European Union’s 27 member states are preparing to enforce these landmark crypto laws this year, and businesses aiming to operate in the bloc should pay close attention to national authorities’ actions, policy experts advise. In a few months, the specialized rules for stablecoin issuers under the Markets in Crypto Assets (MiCA) regulation will come into effect, followed by licensing and other requirements for crypto firms broadly in December.
MiCA was voted into law in 2023 after three years of development by European governments. Once effective, crypto firms, such as issuers, exchanges, and wallet providers, will be able to operate throughout the European Union if they secure licensing in any single member nation.
Each jurisdiction must transpose the EU regulation into local law, select their regulators to oversee crypto, and prepare to authorize token issuers and other service providers. For countries like Germany and France, which have already regulated crypto through strict regimes, the transition to MiCA may not be a major shift. However, for other countries, the change may be significant and place new burdens on local authorities.
CoinDesk contacted regulators and government ministries in all 27 nations for their thoughts and progress on MiCA, and 20 responded by press time. These countries are at various stages of preparation. At least 10 are finalizing or have already finalized local legislation, while others are not as advanced but have time to prepare.
MiCA is an EU-wide regulation, meaning it takes direct effect across the bloc on the agreed deadlines, said Sophie Lessar, partner at law firm DLA Piper, focusing on fintech and digital financial services. “The rules will come into effect. There’s nothing that any regulator will do to hold that up,” she told CoinDesk. However, some technical requirements must be implemented at a national level, Lessar added.
National authorities will decide how to implement flexible technical standards under MiCA, such as the duration of grandfathering periods or the supervision fee structure. Crypto businesses should prepare for compliance and be aware of national-level nuances in implementation.
“The key thing is for people to navigate what this means for their business. Where are they doing business? Are there any differences where national authorities have the ability under MiCA to have slight differences in implementation?” Lessar said.
European countries are in various stages of transposing MiCA into local law, which can involve deciding on local regulators—referred to as National Competent Authorities (NCA) in the MiCA text—and whether to use a transitional period allowed under the regime. There was an expectation that local supervision duties might be divided between a country’s markets regulator and its central bank (to handle stablecoins), according to Marina Markezic, co-founder of the European Crypto Initiative (EUCI), which has been tracking the progression of national legislation.
