Background: MiCAR/ PSD2 overlap for EMTs

The overlap between MiCAR and PSD2 arises from the dual legal nature of EMTs. Under MiCAR, EMTs are crypto-assets that seek to maintain a stable value by referencing an official currency and are expressly deemed to constitute electronic money. As a result, EMTs also qualify as “funds” for the purposes of PSD2. This dual classification means that CASPSs offering services in relation to EMTs may, in certain cases, be subject to both MiCAR authorisation and PSD2 licensing requirements. Until recently, it was unclear which EMT-related crypto-asset services would also qualify as payment services under PSD2.

No-Action Letter

In its No-Action Letter of 2 June 2025 (EBA/Op/2025/08), EBA envisaged that until the transposition deadline of the third Payment Services Directive (PSD3) is reached and the Payment Services Regulation (PSR) is applied, NCAs would require authorisation under PSD2 for only a particular sub-set of CASPs that transact EMTs, following a transition period that ends on 2 March 2026.

Furthermore, in the No-Action Letter, EBA advised NCAs on the short term to: (i) view the transfer of crypto-assets (as defined in MiCAR) as a payment service under PSD2 where they entail EMTs and are offered and carried out by the entities on behalf of their clients and (ii) regard the custody and administration of EMTs as a payment service under PSD2 and the custodial wallet as a payment account where the wallet is held in the name of one or more clients and allows to send and receive EMTs to and from third parties.

For these services, EBA advised NCAs to only require PSD2 authorisation as of 2 March 2026, and to apply simplified procedures during the authorisation process, making maximum use of the information provided by the applicants during their CASP authorisation process.

For the long term, EBA mentioned that it was examining various approaches to the problems arising from the interaction between MiCAR and PSD2 and proposed that the solution should preferably be found by the European Commission, the Council, and the Parliament through the PSD3/PSR legislative process to amend MiCAR by:

  • clarifying in MiCAR that crypto-asset services are only subject to the provisions of MiCAR;
  • clarifying that CASPs providing crypto-asset services with EMTs that can be classified as payment services should only be recognised and supervised under MiCAR; and
  • strengthening the requirements set out in MiCAR by applying them to crypto-asset services with EMTs that can (also) be classified as payment services.

Opinion regarding the end of the No-Action Letter transition period

Since the end of the transition period is approaching, EBA has provided its opinion for the post-transition period. In this opinion, EBA divides three types of recommendations based on three different scenarios.

PSD2 authorisation or partnership with an authorised payment service provider (PSP)

In the first scenario, the CASP has successfully obtained an authorisation as a payment institution (PI)/EMI or has partnered with a PSP authorised to provide the respective services, in which case the CASP is allowed to continue carrying out EMT transactions.

Authorisation application submitted but not granted yet

CASPs that have submitted an application for authorisation under PSD2 during the transition period should, in principle, be permitted to continue providing custody and transfer services in respect of EMTs pending a decision on their application, provided that certain conditions are met.

During the period between the submission of the application and the decision of the NCA (the Interim Period), CASPs providing custody and transfer services in respect of EMTs should not engage in any marketing or promotional activities relating to EMT‑based payment services, nor accept new customers for such services. These restrictions do not apply to CASPs operating pursuant to a national transition period.

No application for authorisation or rejection of the application

CASPs that have not applied for authorisation under PSD2 or whose application for authorisation under PSD2 has been rejected should discontinue their custody and transfer services regarding EMTs as 2 March 2026 and offboard customers of these services.

Lastly, EBA clarifies that the transfer of EMTs between wallets belonging to the same customer are also deemed to be a payment service, regardless of whether the respective wallets qualify as payment accounts.

Contact

We would be happy to assist you in identifying any relevant changes for your organisation. Do you have any questions regarding PSD2 or MiCAR or other topics related to financial regulation? Please contact our financial regulatory team listed down below.