Because the European Union welcomes Crypto asset markets (MiCA) Cyprus requires local VASPs to demonstrate their compliance within one week.
MiCA came into full effect on December 30 with regional and national regulators are rushing to provide regulatory guidance for VASPs. In Cyprus, the Securities and Exchange Commission (CySEC) indicated in October that it would grant any company that registers before the December 30 deadline an extension until July 1, 2026.
In December 31 updatethe regulator reiterated that VASPs who can demonstrate compliance with Cyprus laws by 30 December can continue to operate pending the determination of their applications for a license under Article 63 of the MiCA.
However, he added that he is now asking all VASPs who want to take advantage of this exemption to provide evidence that they have complied with its rules by January 10.
“Specifically, they must submit an appropriate certificate from an internal auditor confirming that the CASP provided services before December 30, 2024,” the regulator stated.
The certificate should contain details of their services, number of clients they have served, volume of transactions, client capital and revenue and profit records.
“Essentially, CySEC is establishing a process to verify the legitimacy and ongoing operation of existing CASPs before granting them the opportunity to apply for a full license under the new regulatory framework,” he added.
While Cyprus offers a grace period, Latvian Central Bank has committed to offering free consultation to all VASPs seeking licensure under MiCA.
“Crypto-asset service providers can start their journey to securing a license by taking advantage of the free pre-license consultations offered by Latvijas Banka,” the bank stated on January 2 and repeated a similar promise he made last September.
Experts from Latvijas Banka will guide VASPs on “application feasibility, regulatory compliance and document readiness.”
Commenting on the offer, Deputy Governor Santa Purgaila noted that the bank has aligned its VASP regulatory approach with EU standardswhich balances flexibility with responsibility. To qualify, VASPs must pay a supervisory fee of 0.6% p.a., with a minimum of €3,000 ($3,079).
Latvia’s free consultation and simplified framework are aimed at attracting European VASPs who have difficulty obtaining licenses in their local jurisdictions. With MiCA, a company can register in any EU country and use an EU passport to service the rest of the region.
Just days after coming into force, MiCA is having a major impact on the European digital assets industry. Stable coins were among the first to feel the heat; USDT, the market leader, lost $3 billion in the last ten days of the year as uncertainty grew over its European future. Tether, issuer of USDThe didn’t want to get a new license because he would have to comply with new laws that threaten his opaque and often illegal business model.
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