Edited by Fabrizio Cascinelli, Francesco Della Scala
On 5 October 2023, the European Securities and Markets Authority (ESMA) launched the second public consultation under the so-called. MICA Regulation (Market in Crypto-Assets Regulation) i.e. Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on Markets in Crypto-assets.
The objective of the MICA Regulation – published in the Official Journal of the European Union on 9 June 2023 – is to address the fragmentation of the European legal framework applicable to crypto-assets and, more specifically, to bidders or persons requesting their admission to trading as well as to service providers involved in such activities.
The Regulation defines “crypto-asset” as “a digital representation of value or rights which may be transferred and stored electronically, using distributed ledger technology or similar technology” and outlines three types of crypto-assets: asset-referenced tokens, e-money tokens and utility tokens, establishing specific rules for each typology.
With reference to timing, the MICA Regulation will be applicable in its totality from December 30, 2024; however, the requirements set for asset-referenced tokens and e-money tokens will be applicable as early as June 30, 2024.
In order to fully implement and enforce the standards set by MICA, ESMA is required to develop (in close cooperation with EBA) Regulatory Technical Standards (RTS), Implementing Technical Standards (ITS) and guidelines; given the volume of technical standards to be developed, ESMA has, at the time, announced that it is dividing the work into three separate consultation “packages”.
ESMA’s first consultation – covering 5 sets of RTS and 2 sets of ITS relating to Crypto-Asset Service Providers (so-called CASPs) – took place between July and September 2023.
Conversely, the three consultations launched by the EBA in July 2023 concerning asset-referenced tokens are still in progress – until 12 October 2023.
With reference to the consultation in hand, it should be noted that this concerns the second set of technical standards expected by ESMA and contains 6 draft RTS and 2 draft ITS, which specifically concern:
- the content, methodologies and presentation of information (to be included in the white paper for crypto-asset issuers as well as to be made public on the website for CASPs) concerning sustainability indicators in relation to climate and other negative environmental impacts (RTS ex Art. 6(12), 19(11), 51(15), 66(6), MICA);
- measures to ensure the continuity and regularity of service for CASP (RTS under Art. 68(10)(a), MICA);
- the records to be kept relating to all cryptocurrency services as well as the records to be kept relating to the activities, orders and transactions carried out by CASPs (RTS ex Art. 68(10)(b), MICA);
- the method of presentation of transparency data, including the level of disaggregation of data to be made available to the public by CASPs operating a crypto-asset trading platform (RTS under Art. 76(16)(a), MICA);
- the content and format of the records in the order book to be kept by CASPs operating a crypto trading platform (RTS ex Art. 76(16)(b), MICA);
- the data required for the classification – in the register to be set up by ESMA itself – of white papers on crypto-assets as well as the practical arrangements for ensuring that such data are machine-readable (RTS ex art. 109(8), MICA);
- standard forms, formats and templates for cryptocurrency white papers to be made available in a machine-readable format (ITS ex-art. 6(11), 19(10), 51(10), MICA);
- the technical means for adequate public disclosure of inside information directly concerning issuers, offerors and persons asking for admission to trading, as well as the technical means by which such public disclosure may be delayed (ITS pursuant to Art. 88(4), MICA).
The consultation closes on 14 December 2023.
Subsequently, ESMA will publish the final report based on the feedback received and submit the draft technical standards to the European Commission for approval by 30 June 2024.
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