European Union: Published ESMA recommendations concerning the transitional period for the implementation of MiCA

On 17 October 2023, the European Securities and Markets Authority (ESMA), published a statement concerning the preparation phase for the implementation of the Markets in Crypto-Assets Regulation (MiCA). In particular, ESMA clarifies to holders of crypto-assets and current or prospective clients of crypto-asset services that the recourse mechanisms under MiCA rules on the provision of crypto-asset services will not come into effect until December 2024. In addition, holders of crypto-assets and clients of crypto-asset service providers may not benefit from full rights and protections under MiCA until as late as 1 July 2026. Furthermore, ESMA issued a letter to NCAs reminding them to establish as early as possible their supervisory procedures related to the authorisation regimes set out in MiCA, including simplified authorisation procedures for entities already authorised to provide crypto-asset services. ESMA also expresses concerns on the potential negative effects of extensive use of the grand-fathering clause and requests Member States to consider reducing the duration of the clause to a maximum of twelve months.