28.06.2024

MiCA-Regulation

New regulation for crypto-assets in the EU from January 2025

From 01 January 2025, the European Union's Markets in Crypto-Assets Regulation (MiCAR) will come into force. This new regulation brings comprehensive regulations and standards for the crypto-asset sector.

Objective of the MiCA regulation

The aim of the European Markets in Crypto-Assets Regulation (MiCAR) is to create a uniform legal framework within the EU in order to harmonise the regulation of crypto-assets and the associated services. This is intended to ensure the integrity of the financial system, improve investor protection and prevent market manipulation.

Why is MiCAR necessary?

The crypto-asset industry has developed rapidly in recent years. However, the growth of this industry is associated with risks such as market manipulation, money laundering or lack of investor protection, which must be prevented. MiCAR was therefore developed to address these new challenges and create a stable and secure environment for the trading and use of crypto-assets.

What are the contents of MiCAR?

All providers of crypto-asset services (crypto exchanges, wallet providers, crypto custodians) will be subject to registration with the relevant supervisory authorities from January 2025. Comprehensive disclosure requirements apply to all issuers of crypto-assets. This includes the preparation of white papers on all crypto assets issued and regular reporting. These measures aim to create transparency and improve investor protection.

MiCAR also contains provisions on the supervision and regulation of trading platforms with the aim of preventing market manipulation and ensuring fair trading conditions. Further provisions are aimed at combating money laundering (AML) and terrorist financing (CFT).To this end, providers of crypto-asset services must implement appropriate measures and ensure that they comply with regulatory requirements.

In addition, MiCAR requires technical security standards and secure identification methods for all crypto-asset services and infrastructures.

New documentation requirements for crypto issuers

From 1 January 2025, crypto issuers of distributed ledger technology-based crypto assets such as e-money tokens, value-referenced tokens and utility tokens are required to publish a detailed whitepaper for each crypto asset.This whitepaper must fulfil the following documentation requirements:

• Machine- and human-readable format: The whitepaper must be created in iXBRL format to be both human- and machine-readable.
• Regular reviews and updates: Each whitepaper must always contain the latest and most important information on each crypto asset.
• Approval by supervisory authority: Each whitepaper must be submitted including all transaction data along with risk assessments and compliance records to the regulator for approval.
• Versioning: Each version of the white paper must be clearly dated and versioned to ensure traceability of changes.
• Archiving: Previous versions of the white paper must be archived and made available upon request to ensure transparency and historical traceability.

Are you ready for all the new MiCA regulations?

The many new MiCAR requirements concern both technical and content-related aspects. The decisive competitive factor will be who has prepared their systems and processes in accordance with the MiCAR requirements by the deadline of 01 January 2025.

Content Software advises you on all questions relating to preparing your systems for the MiCA regulations. We specialise in all processes relating to data and documents and support your conversion process from initial planning to implementation.

Contact us for any question and further information.