Crypto-asset service providers or CASPs may apply for a MiCAR licence with the AFM as of 22 April 2024. This is announced in a publication on the website of the AFM. MiCAR will enter into force as per 30 December 2024, which means that parties who wish to become active as a CASP under MiCAR should have the authorisation at that point in time. For purposes of the licence application, the AFM has amongst others made available a licence application form, a checklist for the licence application and best practices for preparing a licence application. Prior to submitting the licence application, it is possible for market parties to request a so-called pre-scan with the AFM, which offers the opportunity to pre-discuss MiCAR compliance with the AFM and to receive feedback on the draft licence application. It is not mandatory to request for such pre-scan.

Transitional regime for existing crypto-asset service providers

Crypto-asset service providers which already hold a registration on the basis of the Dutch AML Act (Wet ter voorkoming van witwassen en financiering van terrorisme), can benefit of a transitional period. These are parties holding a registration for the offering of custodian wallets for cryptocurrencies and/or offer exchange services for cryptocurrencies into fiat currency and vice versa. Although this is not official yet, it is expected that the transitional period applies until 30 June 2025.

Notification procedure

On the basis of MiCAR, a notification procedure applies to certain entities that are already subject to financial supervision, such as banks, investment firms, electronic money institutions and managers of alternative investment funds (AIFMs), and wish to also provide crypto-asset services. Which crypto-asset services these parties are allowed to offer after having completed the notificatoin procedure, depends on their current authorisatoin. Banks are fully exempt from the licence requirement as a CASP, however other financial entities can only use the notification procedure to provide crypto-asset services which are equivalent to the services and activities for which they are authorised. This means that the provision of any additional crypto-asset services requires a MiCAR licence. As an example, a MiFID II investment firm which is authorised to execute orders of clients in financial instruments will be exempt from the MiCAR licence requirement for execution of orders in crypto-assets but will require a licence under MiCAR to provide advice on crypto-assets. The notification procedure requires the relevant financial entity to provide an information package, including for instance a programme of operations, a description of the relevant internal control framework, policies and procedures. It should be arranged for by relevant entity that the provision of crypto-asset services will comply with the relevant conduct of business rules under MiCAR. The notification procedure is therefore not simply a notification, as the relevant party must demonstrate its compliance with the applicable MiCAR provisions.

Please refer to our previous article for further background information regarding MiCAR.