Three new EBA Q and As in relation to MICAR

The European Banking Authority (“EBA”) has published three new Q&As clarifying elements of the Regulation (EU) No 2023/1114 on Markets in Crypto-Assets (“MICAR”), including passporting procedures for cross-border issuance by credit institutions and e-money institutions, the classification of exchanges involving e-money tokens and publication requirements for white papers.

2024_7168 Passporting procedure for CIs and EMIs issuing tokens under MICAR

EBA Q and A 2024_7168 was posed by the Autorité de contrôle prudentiel et de resolution (a competent authority in France). The Q and A provides that MiCAR confirms credit institutions and e-money institutions issuing asset-referenced tokens (“ARTs”) or e-money tokens (“EMTs”) cross‑border must use the existing sectoral passporting regimes rather than a new “MiCAR‑specific passport”. For credit institutions, Article 146 of MiCAR amends Annex I of Directive 2013/36/EU to include issuing electronic money, including EMTs, within activities subject to mutual recognition, thereby engaging the CRD passport and related notification procedures. For e-money institutions, Article 48(3) of MiCAR points to Titles II and III of the Directive 2009/110/EC (“second Electronic Money Directive” or “EMD2”), so the passporting procedure in Article 3(4) of EMD2 applies to EMT issuance in the absence of a MiCAR‑specific process.

2024_7084 Qualification of crypto-asset service in case of exchange of electronic money tokens for other crypto-assets

EBA Q and A 2024_7084 was posed by the same French competent authority and clarifies that although EMTs are deemed electronic money under Article 48(2) of MiCAR and therefore considered “funds,” they remain a type of crypto‑asset under Article 3(1)(7) for the purpose of interpreting crypto‑asset services within MiCAR. Accordingly, when a crypto‑asset service provider facilitates the exchange of EMTs for other crypto‑assets, the activity should be treated as an exchange of crypto‑assets for crypto‑assets within MiCAR’s service taxonomy, rather than an exchange of funds for crypto‑assets.

2024_7166 Publication of white papers

EBA Q and A 2024_7166 was posed by the Central Bank of Ireland and clarifies that article 28 of MiCAR on the publication of crypto‑asset white papers applies to ART issuers that are exempt from authorisation under Article 16(2). This ensures that those notified white papers are made available to intended audiences notwithstanding the exemption.

How FM Legal can assist

Our crypto‑regulatory lawyers advise on MiCAR readiness, authorisations and exemptions, cross‑border passporting strategies, and product design for ARTs, EMTs and other crypto‑assets. We assist with white paper preparation and publication, governance and compliance frameworks, and interaction with national competent authorities across the EU. To discuss how these Q&As affect your business model, please contact our team for a confidential discussion.