ESMA consults on operating procedures for cryptoasset service providers
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ESMA consults on operating procedures for cryptoasset service providers 21 August 2023EU Reporter: Bob Currie
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The European Securities and Markets Authority (ESMA) has launched a consultation relating to the authorisation and operating procedures for cryptoasset service providers (CASP).
This provides a framework to guide the activities of service providers under the Regulation on Markets in Cryptoassets (MiCA), which entered into force in the European Union on 29 June 2023.
This offers a package of regulatory technical standards and implementing technical standards under MiCA relating to the authorisation process for CASPs, for identifying and preventing conflicts of interests among this service provider community, and for managing the complaint handling process.
ESMA, the European securities markets regulator, is charged with developing technical standards and guidelines for implementation of this regulation, at some points in liaison with the European Banking Authority, and has released the first of three consultation papers as part of this process.
In parallel, ESMA indicates that it will be collecting additional information on service providers’ operations and activities as part of a broader fact gathering exercise to provide better understanding of the EU cryptoasset markets and their development, including the expected turnover of respondents and their trading activities on and off blockchain.
The Authority indicates that this information will remain confidential and will guide content that will be addressed in the second and third consultation processes. The second consultation package is expected in October 2023.
ESMA chair Verena Ross comments: “This first consultation package is an important milestone for ESMA in the implementation of the MiCA framework. It translates our ambition to set high regulatory standards in the EU for the cryptoasset related activities into concrete requirements.
“We are determined to ensure entities involved in cryptoasset related activities understand that the EU is not a place for forum shopping. We also want to remind consumers that, even with the implementation of MiCA, there will be no such thing as a safe cryptoasset.”
ESMA invites responses to the consultation process by 20 September 2023. It will subsequently analyse feedback on the three consultation papers and plans to deliver draft technical standards to the European Commission for endorsement by 30 June 2024.
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