CySEC’s Shift Towards MiCAR: Implications for Crypto-Asset Service Providers
The Cyprus Securities and Exchange Commission (CySEC) on the 17th of October 2024, has announced that it will no longer accept new applications for the registration of Crypto-Asset Service Providers (CASPs).
This move is part of Cyprus’ preparations for the implementation of the European Union’s Markets in Crypto-Assets Regulation (MiCAR). The new regulatory framework, introduced by Regulation (EU) 2023/1114, will fully come into force on December 30, 2024.
In addition, CySEC stated that it will cease accepting notifications from entities that are registered with one or more national authorities within the European Economic Area (EEA) for the provision of crypto-asset services as of October 30 2024.
CySEC clarified that this decision marks the beginning of a transition to the MiCAR rules, which are designed to provide a harmonized legal framework for crypto-asset activities across the EU. Consequently, CySEC will not process any CASP registration applications under the existing national rules. Additionally, the MiCAR regulation has already begun applying to issuers of Asset Reference Tokens (ARTs) and E-Money Tokens (EMTs) as of June 30, 2024, signalling the gradual enforcement of the new regulations.
In light of the above, CySEC wishes to draw the attention of interested parties to the ‘Transitional Measures’ in Article 143, Paragraph 3 of the Markets in Crypto-Assets Regulation, which states: “Crypto-asset service providers that were offering their services in accordance with applicable legislation before December 30, 2024, may continue to do so until July 1, 2026, or until they receive a license or rejection under Article 63, whichever comes first.”
As a result, CASPs registered in the CASP Registry under the National Rules before December 30, 2024, may continue to provide their services until July 1, 2026, or until they receive either a license or rejection under Article 63, depending on which date comes first.
With these measures, CySEC is working to ensure a smooth transition for crypto-asset service providers ahead of the MiCAR regulation’s full implementation, while aiming to align its national regulatory approach with the EU’s upcoming comprehensive framework for crypto-assets.
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