Guidelines Seek Clarity for Crypto Asset Firms
The European Securities and Markets Authority (ESMA) has issued draft guidelines that prioritize crypto firms within the European Union (EU) over those based outside the bloc. These guidelines, published on Monday in a consultation paper, aim to provide clarity under the Markets in Crypto Asset (MiCA) rules enacted last year. According to the paper, the objective is to ensure that clients of crypto asset service providers (CASPs) operating within the EU receive full rights and protections afforded under MiCA. Additionally, the guidelines aim to prevent EU CASPs from being competitively disadvantaged compared to third-country firms when it comes to serving EU clients.
Guidelines Define Solicitation and Its Broad Interpretation
As per the guidelines, solicitation activities encompass various forms such as advertisements, sponsorship deals, and even influencer or celebrity endorsements. Furthermore, the paper highlights the need for a “broad interpretation” of the term “person soliciting.” The relationship between a third-country firm and the individual soliciting on its behalf does not necessarily have to be contractual. However, there is one exception: if a client initiates contact and requests a service from the third-country firm, it may be provided.
ESMA Releases Additional Consultation Paper on Crypto Assets
In addition to the guidelines for prioritizing crypto firms, ESMA has published another consultation paper that addresses the regulatory framework for crypto assets. The paper clarifies that crypto assets falling outside the scope of other existing EU legal frameworks for financial instruments are likely but not automatically subject to the MiCA framework. However, it explicitly mentions that non-fungible tokens (NFTs) are outside the scope of this regulatory framework. ESMA, along with the European Banking Authority, will oversee compliance with these regulations for crypto assets within the EU.