MiCA review asks whether EU’s crypto regime is fit for the future

At a key juncture for the development of cryptoasset regimes around the world, the European Commission has launched a review of the EU’s regulation on markets in cryptoassets (MiCA). As an open fact-finding exercise rather than a list of proposed reforms, the Commission's consultation offers an opportunity for industry to contribute to the future direction of the regulatory regime. The deadline for responses is 31 August 2026.

MiCA requires the Commission to report to the European Parliament and Council on its application and market developments. According to the Commission, the review is a chance to take stock of whether MiCA is fit for purpose given how crypto markets have evolved since the legislation was designed over three years ago.

The consultation does not make policy proposals. It does, however, indicate the areas which the Commission wants to explore further and which may lead to proposals to amend MiCA. The consultation covers a wide variety of topics, of which the most significant include:

• Scope of MiCA v MiFID: A recurring topic of discussion is the perimeter between MiCA and sectoral financial services law for traditional financial instruments, in particular the Markets in Financial Instruments Directive (MiFID). The question has become more prevalent as traditional institutions increasingly offer cryptoassets while cryptoasset service providers (CASPs) expand into traditional financial products or offer crypto assets “wrapped” into traditional financial instruments, such as futures and exchange traded notes. Currently, cryptoassets that also qualify as financial instruments fall outside the MiCA regime. The Commission asks whether this should remain so and whether the distinction between MiFID financial instruments and MiCA cryptoassets is sufficiently clear. More specifically, the consultation also asks whether prediction markets based on distributed ledgers and perpetual futures on cryptoassets should be governed by MiCA or MiFID.

• Stablecoins: Unsurprisingly, stablecoins are a central focus of consultation. The Commission asks whether to recalibrate:

  • reserve and segregation requirements for issuers of e-money tokens (EMTs), including the controversial question whether credit institutions issuing EMTs should face reserve/segregation duties akin to non‑banks, or would continue to be able to issue “balance-sheet backed” EMTs,

  • the criteria for “significant” tokens (which trigger higher prudential/governance and supervisory expectations),

  • the interest/remuneration ban (MiCA currently prohibits interest or interest‑equivalent remuneration on asset-referenced tokens and EMTs), and

  • the resilience of redemption rights, including how they function in stress and whether redemption protections should be supported by enhanced safeguards, such as deposition of reserve assets directly into central bank accounts or a resolution regime for EMT issuers.

• Licensed ARTs: Asset-referenced tokens (ARTs) are, broadly, stablecoins pegged to a basket of currencies or another asset. No ARTs have been licensed under MiCA yet. The consultation asks whether this reflects low interest in the market for these stablecoins or the regulatory requirements for ARTs under MiCA.

• Global stablecoins: Under a multi-issuer model, EU and overseas entities jointly issue stablecoins which are fungible across the entities. This model is permissible under MiCA but has raised concerns that redemptions for overseas token holders may reduce the reserves available to EU token holders, especially at a time of market stress. The consultation asks whether MiCA should continue to be open to multi-issuance models and whether requirements should be introduced to, for example, strengthen the redemption rights of customers of EU CASPs.

• Equivalence: While many jurisdictions now have or are developing cryptoasset regulators frameworks, MiCA does not have a mechanism for recognising or deferring to a third country regime. The consultation asks whether there is merit in introducing an equivalence regime for global stablecoins.

• Cryptoasset services: The Commission asks whether the list of regulated cryptoasset services under MiCA should change, including whether lending and borrowing of cryptoassets should be regulated. The Commission also asks whether MiCA allows EU consumers and investors to have sufficient access to global trading and liquidity pools.

• Appropriateness: The consultation asks whether MiCA should require CASPs to consider the appropriateness of certain services for their customers, especially retail clients.

• Prudential regime: The Commission asks whether the prudential regime, which requires CASPs to hold regulatory capital, is appropriate to capture the risks associated with cryptoasset services.

• Reporting: Currently, MiCA does not impose formal reporting obligations on CASPs. The consultation asks whether CASPs should regularly report on, for example, their holdings of cryptoassets, their exposures to crypto derivatives and information on counterparty risk.

• ESG: MiCA requires cryptoasset white papers to contain information about the environmental impact of the relevant consensus mechanisms and CASPs to make this information available. The Commission asks whether this sustainability reporting is appropriate or could be improved.

• Payments: The consultation asks whether changes to the EU’s payment services framework sufficiently clarify the interplay between that regime and MiCA.

• Tokenised deposits: Deposits fall outside the scope of MiCA but the Commission invites feedback on any regulatory issues which constrain the development of tokenised deposits in the EU.

• Tokenisation: While MiCA is fundamentally a regulatory framework, the consultation also raises private law considerations, including around tokenisation “ownership” models and whether a conflicts of law rule could address certain proprietary matters concerning cryptoassets.

• DeFi: MiCA does not apply to fully decentralised cryptoasset services. The Commission does not suggest changing this approach but asks about the factors that should be considered when assessing the degree of decentralisation. The consultation also asks if MiCA should indirectly account for DeFi by, for example, requiring CASPs to conduct due diligence over DeFi protocols, make disclosures to their clients about DeFi risks, or take liability for incidents relating to DeFi applications, and whether certification schemes should be introduced for DeFi protocols and smart contracts.

• Simplification: As part of the Commission’s simplification agenda, the consultation asks for examples of administrative simplification or burden reduction measures it could take forward.

Despite being labelled as a “targeted” consultation, the broad range of questions invites firms in the crypto and financial services industry to share their views on how MiCA should evolve across all aspects of the regime. This may include share lessons learned from other regulatory regimes that have emerged since MiCA was introduced, including the UK cryptoasset regime which will start to apply in October 2027.

Firms have just over three months to respond to the consultation which closes on 31 August 2026. Firms should particularly note the potential impact of changes to the scope of MiCA (e.g. the approach to DeFi, regulated services, and interplay with other regulatory regimes) and new rules which could have operational impacts (e.g. appropriateness tests, reporting requirements, and liability for DeFi).