Crypto▼ Bearish
Some MiCA-licensed crypto firms may still exit EU: Gate Europe CEO
Giovanni Cunti says some companies with a MiCA license won't be able to sustain the compliance costs. ESMA's register grew to 294 firms. New entrants are slowing.
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Some crypto companies already holding a license under the European Union's Markets in Crypto-Assets Regulation could still walk away from the market, Gate Europe CEO Giovanni Cunti said. MiCA, the EU's rulebook for crypto assets, requires firms to meet strict capital and governance standards. Compliance costs are rising faster than some firms can absorb.
"I think there are going to be quite a few more of the ones that acquire MiCA license that will not be capable to sustain the cost and the resources that are needed to carry on this business in the long term," Cunti told Cointelegraph's Chain Reaction on Monday.
The EU's 18-month transition period for MiCA ended July 1. Firms without authorization had to stop offering regulated services to EU customers. The deadline prompted Binance, the world's largest crypto exchange by trading volume, to restructure its European operations after it failed to secure a license in time. Several other exchanges restricted services in parts of Europe rather than seek full authorization under the new regime.
Cunti said the stricter rules could push crypto startups and projects outside Europe. The framework strengthens investor protections. Cunti said it leaves less room for innovation than jurisdictions with lighter rules. Some projects may choose to launch in places with different guidelines instead of working within the EU's compliance regime.