CySEC Provides New Guidance For Crypto Asset Service Providers Under MiCA
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The Cyprus Securities and Exchange Commission (CySEC) recently issued updated guidance for Crypto-Asset Service Providers (CASPs). The new set of rules outlines the obligations that concern the crypto industry under the transitional provisions of the MiCA regulations.
According to the regulator, CASPs that provided their services in compliance with national regulations prior to December 30 of this year can continue to conduct their operations during the upcoming transitional period, which extends until July 1, 2026. Alternatively, things will remain the same for them until they are denied or granted authorization under MiCA, which could happen before the July 1 deadline.
The regulator also outlined requirements for CASPs that plan to operate during the transitional phase, detailing that these entities will have to provide evidence that proves their compliance with the standing rules.
The Transition Period Is About To Start
The required documentation must include a confirmation letter from the service provider’s Internal Auditor, as well as supporting details on their operations. The regulator said that the data CASPs must submit by January includes the provided services, client distribution in a geographical sense, client fund and crypto asset holdings, transaction volumes, as well as income generated from the services they provide,
The deadline for providing the data is January 10, 2025, and CySEC urged the companies affected by the new rules to contact its Authorizations Department if they find themselves in need of further clarification or if they have any questions.
The idea is to use these updated guidelines to make sure CASPs comply with MiCA regulations even during the transitional period before the MiCA gets in full force. This will also be easier on crypto asset service providers, who will be ready to be fully regulatory compliant by the time MiCA arrives in full.
CySEC also announced last month that it started accepting CASP license applications for preliminary assessment under the MiCA framework. According to the regulator, the initiative is aimed at facilitating a smoother transition, which would also go a long way in enhancing investor protection in financial markets.
But, the regulator was sure to clarify that it cannot guarantee the approval of CASP licenses before the EU deadline, although some applications and notifications from locally registered entities might be prioritized.
