Markets in Crypto-Assets Regulation (MiCAR)

MiCAR brings issuers of certain types of crypto-assets into the regulatory framework. Specifically, MiCAR establishes new rules for issuers of crypto-assets known as "stablecoins" including ARTs, EMTs, along with new rules for other crypto assets such as utility tokens. 

As defined by MiCAR:

• An ART purports to maintain a stable value by referencing another value or right or a combination thereof, including one or more official currencies;
• An EMTs purports to maintain a stable value by referencing the value of  a single official currency; and
• A Utility token provides access to a good or service supplied by the issuer of that token.

As of 30 June 2024, issuers of ARTs and EMTs are required to be authorised by their National Competent Authority (NCA) and to publish a white paper containing information on the relevant ART/EMT for consumers.

MiCAR recognises that some ARTs or EMTs may be significant due to their size and other factors and as a result may present an increased risk. Accordingly, the European Banking Authority (EBA) will have supervisory responsibilities for the issuance function under MiCAR of issuers of significant ARTs and some significant EMTs. 

Issuers of ARTs and EMTs - engagement with the Central Bank

A legal person or other undertaking that intends to offer to the public or seek the admission to trading of ARTs should contact the ART authorisation team (ART [email protected]) at their earliest opportunity.

A credit institution that intends to offer an ART to the public or seek its admission to trading should engage directly with its supervision team at its earliest opportunity for further guidance.

A credit institution or electronic money institution (EMI) that intends to offer an EMT to the public or seek its admission to trading should engage directly with their supervision team at the earliest opportunity for further guidance.

Guidance Note for Issuers of ARTs & EMTs

ART Key Facts Document

EBA Statement on the application of MiCAR to ARTs and EMTs (July 2024):

In this statement:

• The EBA outlines it expects that any person which intends to commence ART or EMT activities to comply fully with MiCAR from 30 June 2024.
• The EBA notes that consumers considering buying an EMT or an ART should check whether the issue, offer, or admission to trading is carried out in accordance with MiCAR. 
• This information should be signalled clearly in the white paper for the crypto-asset and on the issuer’s/offeror’s trading platform/website, and also documented in the ESMA register.  Authorisation information may also be verified on the website of the relevant NCA; 
• It is important for consumers to be aware that if an issue, offer, or admission to trading of an ART or EMT is not carried out in accordance with MiCAR, the safeguards set out in MiCAR do not apply, and consumers should be extremely cautious in acquiring such crypto-assets.
• The EBA also notes that from the 30 June 2024, stakeholders carrying out ART/EMT activities should assess their compliance with MiCAR, and refrain from carrying out services which constitute offering to the public, seeking admission to trading, or placingnon-compliant ARTs/EMTs. The Central Bank has not approved or been notified of any crypto-asset white paper for an ART or EMT under MiCAR issued by any Irish Credit Institution, EMI, legal person or  other undertaking established in the State. 

ESMA Statement On the provision of certain crypto-asset services in relation to non-MiCAR compliant ARTs and EMTs (January 2025):

• ESMA notes that NCAs should ensure compliance by CASPs regarding non-compliant ARTs or EMTs as soon as possible and no later than end of Q1 2025.
• CASPs operating a trading platform for crypto-assets are expected to stop making non-MiCAR compliant ARTs and EMTs available for trading.

EBA Statement - supervisory priorities for issuers of ARTs and EMTs 2024 /2025 (July 2024):

On 5 July the EBA published a separate statement for the attention of persons issuing to the public, offering to the public, or seeking admission to trading of  ARTs and EMTs and for consumers. The EBA also sets out key topics for supervisory attention across the European Union for issuers of ARTs/EMTs in 2024/2025.

MiCAR establishes new rules for issuers and offerors of crypto-assets other than asset-referenced tokens (ARTs) or e-money tokens (EMTs) under Title II.

As defined by MiCAR, Title II other crypto-assets are:

1. Not an ART or EMT;
2. Not a crypto-asset excluded from the scope of MiCAR pursuant to Article 2(4);

From 30 December 2024, MiCAR Title II is directly applicable to offerors and persons seeking admission to trading of a crypto-asset other than an ART or EMT. Said parties must be aware of their following regulatory obligations:

• Notification of the crypto-asset white paper to the competent authority (Article 8 MiCAR);
• Compliance with requirements for market communications, if any (Article 7 MiCAR);
• Compliance with the conduct of business rules (Article 14 MiCAR); and
• Liability for the information provided in the crypto-asset white paper (Article 15 MiCAR).

The specific content and form of the crypto-asset white paper explanation is prescribed in these European Supervisory Authorities’ guidelines as mandated by Article 97(1) MiCAR.

Crypto-Assets other than ARTs or EMTs - engagement with the Central Bank

Crypto-asset white papers must be notified to Primary Markets, within the Capital Markets and Funds Directorate. The contact address for the white-paper notification for crypto-assets other than ARTs or EMTs is ([email protected]). 

Please note the Central Bank does not have an approval role for such white papers.  

CASPs shall require authorisation in order to operate within the EU. The types of crypto-asset services and activities covered by MiCAR include:

• Providing custody and administration of crypto-assets on behalf of clients
• Operation of a trading platform for crypto-assets
• Exchange of crypto-assets for funds
• Exchange of crypto-assets for other crypto-assets
• Execution of orders for crypto-assets on behalf of clients
• Placing of crypto-assets
• Reception and transmission of orders for crypto-assets on behalf of clients
• Providing advice on crypto-assets
• Providing portfolio management on crypto-assets
• Providing transfer services for crypto-assets on behalf of clients

At a high level, CASPs authorised under MiCAR will be subject to anti-money laundering, prudential and conduct requirements. 

Initial engagement stage

• Initial engagement meeting.
• A presentation on the Applicant’s proposal to be submitted at least ten working days in advance of the arranged meeting date. The Central Bank will provide details on the expected content of this presentation.
• At the meeting the Central Bank will outline:
  • The stages of the authorisation process
  • Its authorisation and supervision expectations and
  • The detail and purpose of the Key Facts Document (KFD).
• Following the meeting, the Central Bank will communicate any issues identified that need to be addressed if the application is to proceed to the KFD stage.

KFD stage

• The Applicant will submit a KFD (using the standard template and associated guidance). The CASP KFD supports a robust assessment in the pre-application stage.
• To facilitate and support firms in progressing applications under new Regulations, including Digital Operational Resilience Act (DORA), this KFD provides for a more prescriptive level of detail.
• The ability of firms to engage in robust discussions on their proposal at this stage will have a critical impact on the timelines.
• The Central Bank will perform an assessment of the KFD to determine if the application aligns with the Central Bank’s authorisation and supervision expectations.  There will be continuous engagement with the Applicant and additional information may be required.
• The Central Bank will communicate any issues identified that need to be addressed if the application is to proceed to the application phase.

CASP Key Facts Document 

Formal Applications Submission Stage

• The Applicant will be invited to submit a CASP authorisation application form
• Review of completeness by Central Bank within 25 working days
• Any outstanding items to be submitted within the timeframe set by the Central Bank.

CASP Application Form

Anti-Money Laundering, Countering the Financing of Terrorism and Financial Sanctions Pre-Authorisation Risk Evaluation Questionnaire *

* Only applicant firms who are not VASPs in Ireland must complete the Anti-Money Laundering, Counter-Terrorist Financing and Financial Sanctions Pre-Authorisation Risk Evaluation Questionnaire.

Potential refusal to review (incomplete application)

• In accordance with Article 63 (3) MiCAR the Central Bank may refuse to review applications which remain incomplete after expiry of timeframe by the Central Bank to submit outstanding items.

Assessment stage (complete application)

• The Central Bank will begin the 40 working day assessment of application
• Additional information may be requested from the Applicant, resulting in one suspension of the assessment period (of no more than 20 working days).

Decision

• Communication of outcome of Central Bank assessment to the Applicant within 5 working days of decision to grant or refuse authorisation.

Potential CASPs Applicants should commence engagement with the Central Bank in good time by emailing: [email protected].

MiCAR also introduces new rules that prohibit market abuse related to any type of crypto-asset transaction or service, including unlawful disclosure of inside information, insider trading and actions that are likely to lead to disruption or manipulation of crypto-assets.

MiCAR provides for a transitional period for CASPs that provided their services in accordance with applicable national law prior to 30 December 2024.

Article 143(3) MiCAR provides for a transitional period of up to 18 months, but allows Member States the discretion to reduce its duration where they consider the national regulatory framework is less strict than MiCAR. Following its public consultation on Member State discretions in MiCAR, the Department of Finance outlined in its feedback statement that the transitional period, shall be a maximum period of 12 months and will end on 29 December 2025.  This is further prescribed in Regulation 20 of S.I. No. 607/2024 - European Union (Markets in Crypto-Assets) Regulations 2024.

See also: Impact of Markets in Crypto Assets Regulation (MiCAR) on Virtual Asset Services Providers

In accordance with Article 60 of MiCAR, certain regulated financial service providers (‘RFSPs’) can provide some or all of the crypto-asset services, defined in MiCAR Article 3(16), without the requirement to obtain authorisation as a CASP.

In order to avail of the exemption from authorisation, the in-scope RFSPs must submit a Notification Form for the provision of crypto-asset services to the Central Bank and provide certain information before offering those services for the first time.

Please note that notifying entities must consider whether approval or notification is required under their existing authorisation/supervisory regime.

RFSPs within the scope of this guidance are expected to contact their supervision team once they have decided to offer any of the specified services, prior to submitting the formal notification under MiCAR.

The EBA and ESMA have developed the majority of the level 2 and 3 texts which, will provide greater granularity on the provisions in MiCAR.

The texts are not yet all finalised. However, in its July 2024 statement the EBA notes that the regulatory and implementing technical standards and guidelines applicable to the issuers and offerors of ARTs and EMTs are available on the EBA’s website. The EBA urges issuers and offerors to have regard to these documents and adjust as if those measures were fully applicable, in the case of technical standards pending their adoption by the European Commission and publication in the Official Journal of the European Union. This includes measures relating to white papers, governance, complaints handling, own funds, reserve assets, recovery and redemption plans.

Firms should regularly monitor EBA, ESMA and European Commission’s websites for updates on these texts.

See further information available on ESMA’s three MiCAR consultation packages and the EBA’s approach to its MiCAR policy mandate.  

The ESAs have developed respective Q&A tools which firms can utilise if they have a query regarding the application of MiCAR (refer to EBA and ESMA).  ESMA has also published a number of Q&A’s relating to MiCAR.

The Central Bank supports measures by the ESA’s to driver supervisory convergence.

ESMA measures to encourage market participants and NCAs preparation for MiCAR (October 2023)

 ESMA published a statement in which it notes that full MiCAR rights and protections will not apply to the provision of crypto-asset services until December 2024. ESMA also encourages preparations for a smooth transition to MiCAR across all EU Member States.

Additionally, in a letter addressed to the Economic and Financial Affairs Council (ECOFIN), ESMA Chair, Verena Ross, outlines that coordinated action from EU Member States will be paramount to ensure the smooth, convergent, and effective application of MiCAR.

Firstly, ESMA note that NCAs will need to establish as early as they can, supervisory procedures related to the authorisation regime set out in MiCAR. Secondly, ESMA expressed concern that extensive use of the transitional period for entities already providing crypto-asset services in the European Union would weaken the effectiveness of the MiCAR rulebook and so ESMA invited Member States to consider reducing the transitional period for entities that are already providing crypto-asset services from eighteen to twelve months.

Simplified procedure for applications for CASP authorisation

MiCAR (Article 143(6)) provides for a derogation from the authorisation requirements contained in Articles 62 and 63, which allows Member States to implement a “simplified procedure” for service providers authorised and operating under national law to provide crypto-asset services prior to 30 December 2024.

Following the above public consultation and as outlined in its feedback statement, the Department of Finance has decided not to exercise the discretion provided for in Article 143(6).

This position reflects the advice of European Securities and Markets Authority (ESMA), and recognises that Ireland’s existing VASP regime under the Criminal Justice (Money Laundering and Terrorist Financing) Acts 2010 to 2021 as amended, is not comparable to the MiCAR CASP requirements.

ESMA delivers opinion on global crypto firms using their non-EU execution venues (July 2024)

On 31 July 2024, ESMA issued  an Opinion to address the risks presented by global crypto firms seeking authorisation under MiCAR for part of their activities (crypto brokerage) while keeping a substantial part of their group activities (intra-group execution venues) outside the European Union (EU) regulatory scope.  ESMA recommends that NCAs are vigilant during the authorisation process and assess business structures of global firms to ensure that they do not bypass obligations established in MiCAR, to protect consumers and ensure transparent and orderly functioning of crypto markets.  

Additionally ESMA’s supervisory briefing on the authorisation of CASPs under MiCAR, published January 2025, provides clear guidance to firms on the practical application of MiCA requirements to the authorisation of CASPs including inter-alia guidance on substance and governance, outsourcing and the requirement to maintain robust local governance and risk management arrangements.

The Central Bank has been designated as the NCA for the authorisation and supervision of entities that are subject to MiCAR.

The Central Bank continues to encourage firms that may provide services or products under MiCAR to engage with the Central Bank.

The Central Bank continues its' implementation of MiCAR and has established a cross-sectoral team to integrate MiCAR into the Central Bank’s supervisory and authorisation processes and methodologies.

On 18 July 2024, Derville Rowland, Deputy Governor, Consumer & Investor Protection hosted an industry briefing, which focused on the Central Bank’s approach to implementing MiCAR and also included an overview of:

• The Central Bank’s MiCAR Risk Appetite
• The Central Bank’s MiCAR Authorisation and Supervisory expectations and
• The potential next steps for firms preparing to engage with the Central Bank. 

Finally, the Central Bank will continue to monitor developments related to crypto-assets in order to assess any risks to consumer protection and financial stability.

Consumer information related to crypto assets is available on our consumer hub.