The European Securities and Markets Authority (ESMA) said in an Oct. 8 opinion that licensed crypto platforms in the EU should stop providing services tied to tokens that are not authorized under the bloc’s Markets in Crypto-Assets regulation, or MiCA. The opinion is directed at national regulators and says any remaining customer exposure should be cleaned up within three months.
The document covers asset-referenced tokens and e-money tokens, the two MiCA categories that include stablecoins. ESMA did not name any specific token.
ESMA says licensed platforms should halt covered services
ESMA wrote that crypto-asset service providers, or CASPs, should not provide crypto-asset services linked to tokens that fall short of MiCA requirements. It cited their duty under Article 66(1) to act honestly, fairly, and professionally in the interests of clients.
Supervisors should examine whether a platform’s services, either individually or in combination, allow EU clients to buy, trade, swap, or add to positions in those tokens. ESMA listed the following services:
- trading platforms
- exchange services
- order execution
- advice
- transfers
- custody
- portfolio management
Warnings, disclosures, and client acknowledgements would not be enough, ESMA said. It wants technical, contractual, and organizational controls that prevent EU clients from acquiring those tokens or increasing their holdings.
Three-month deadline for legacy exposure
Where regulators find remaining legacy exposure, ESMA said they should require remediation quickly and no later than three months after publication of the opinion. Based on the Oct. 8 date on the document, the outer limit is about Jan. 8, 2027.
Any services that continue should be limited to selling, converting, transferring, or withdrawing assets, according to ESMA. Those services should also be time-limited and closely supervised. Regulators may allow narrow residual services, including safekeeping, so existing holdings can be wound down in an orderly way.
New purchases, promotion, trading, active distribution, and continued market availability should not continue, ESMA said.
Why ESMA said it acted
ESMA argued that keeping such tokens available through licensed platforms would allow them to bypass the redemption, reserve, governance, and disclosure rules that authorized issuers must follow. In its view, that would put compliant issuers at a disadvantage and weaken investor confidence.
The opinion builds on a January 2025 statement in which ESMA said national authorities were expected to bring platforms into line by the end of the first quarter of 2025. MiCA’s stablecoin rules have applied since June 30, 2024.
The report also noted that MiCA has already pushed Tether’s USDT off several EU exchanges. It added that the European Commission has been preparing to reopen the regulation to cover foreign stablecoin issuers, with a revision expected in 2027.