The European Commission has concluded its consultation period regarding the review of the Markets in Crypto Assets Regulation (MiCA). This framework established a unified rulebook for digital assets, allowing authorized crypto asset service providers (CASPs) to passport their services across the European Union and the European Economic Area.
The regulation replaced a fragmented system of national regimes with a single market covering approximately 450 million people. While this unified approach allows firms to utilize one compliance architecture instead of navigating 30 different sets of requirements, it has also introduced more demanding authorization standards.
The current review process aims to evaluate whether compliance obligations remain proportionate to the risks they address. Industry participants note that compliance costs have risen significantly, which disproportionately affects smaller firms and new market entrants, potentially creating barriers to entry.
The review is expected to assess whether existing reporting and documentation requirements provide material risk reduction. The objective is to ensure that the regulatory framework does not become overly burdensome, which could otherwise drive investment toward jurisdictions with lower operational friction.
