EU Releases Two Crypto Consultation Papers
The European Securities and Markets Authority (ESMA) recently published two consultation papers on January 29th regarding its responsibility to establish standards and guidelines for the implementation of the Markets in Crypto-Assets (MiCA) legislation.
These papers specifically focused on the topics of reverse solicitation and qualifying crypto assets as financial instruments. Reverse solicitation refers to the practice of a potential customer approaching a firm for crypto asset services, and is allowed under an exemption within the MiCA framework.
This exemption permits third-country crypto asset firms to provide services to clients in the European Union solely through this method.
However, the ESMA views reverse solicitation as a narrow exemption and is committed to actively protecting EU-based investors and MiCA-compliant crypto asset service providers from any unauthorized actions by non-EU and non-MiCA compliant entities.
In line with this, the ESMA proposed guidelines for national regulators based on the Markets in Financial Instruments Directive 2014 (MiFID II), which includes similar provisions.
