Key changes include:
The publication aims to provide National Competent Authorities (NCAs) with guidance on the practical application of MiCA across the EU.
Key takeaways from the report include:
➡️ Risk-Based Approach: ESMA does not consider any CASPs as low risk with the guidance outlining the factors that increase firm risk such as size, outsourcing, and business model;
➡️ Substance and Governance: NCAs must ensure firms have sufficient in-country personnel, executive presence, and that key functions are not primarily performed outside the EU;
➡️ Outsourcing: CASPs must be able to demonstrate effective control over outsourced activities and must not outsource to the extent that they become ‘letter-box entities’; and
➡️ Business Plans: Must be realistic with intermediate milestones and consider scenarios where revenues fall significantly below projections.
✅ CASPs operating in the EU should ensure review their governance frameworks and business plans to ensure they align with the regulator’s expectations.
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