MiCA’s roots in MiFID: future & criteria!

WALLESS partner Laurynas Narvydas and senior associate Dr Eugenijus Miliukas share key perspectives from ESMA’s latest consultation papers under MiCA, offering clarity and criteria to distinguish crypto-assets from financial instruments and on reverse solicitation. These papers reaffirm MiCA’s roots in MiFID II’s regulatory framework.

The proposed guidance for reverse solicitation aims at a level playing field for non-EU crypto firms, with stricter conditions ensuring fairness in EU services alignment with the client’s initial request.

Criteria for crypto-assets as financial instruments seek to bridge MiCA and MiFID II, emphasizing a ‘substance over form’ approach and technology neutrality. However, the challenge lies in the nuanced, case-by-case approach due to the absence of a universally accepted ‘financial instrument’ definition under MiFID.