The European Securities and Markets Authority (ESMA) has clarified that crypto-asset service providers authorised under the Markets in Crypto-Assets Regulation should cease providing services related to non-compliant asset-referenced tokens and e-money tokens for clients in the European Union. In an opinion published on 8 October, ESMA called on national competent authorities to supervise providers and ensure they have technical, contractual and organisational controls to prevent access to those tokens, including acquiring or increasing exposure. Where authorities identify existing exposures, they should require remediation as soon as possible and no later than three months after publication. Services may continue only when necessary for liquidation, conversion, withdrawal, transfer or safekeeping, and must be time-limited, risk-based and closely supervised.

Why it matters

  • ESMA’s expectations cover a broad range of MiCA-regulated crypto-asset services.
  • Supervisors are to oversee both controls preventing new exposure and remediation of existing positions.