At the beginning of the year, the German Federal Financial Supervisory Authority (“BaFin“) released a guidance document on crypto-asset services under the new EU Regulation on Markets in Crypto-Assets (“MiCAR“). This regulation has been directly applicable to crypto service providers in the EU since December 30, 2024.
The guidance provides clarifications on the licensing requirements for crypto services and the obligations for providers. Key points include:
- Definitions of Crypto Services: BaFin specifies which crypto services are subject to licensing and connects these to the well-established investment services under MiFID II.
- Licensing of Crypto-Asset Service Providers: The guidance includes detailed information on when licensing requirements apply, and which entities are eligible for authorization.
- Notification Requirement: Entities with existing licenses (e.g., credit or investment institutions) may provide certain crypto services without obtaining additional authorization but must notify BaFin in accordance with MiCAR requirements. The guidance outlines the specific requirements for this notification procedure.
The guidance serves as a practical tool for crypto businesses to navigate and comply with the new regulatory framework established under MiCAR securely and efficiently.
