1. Introduction
Starting in 2025, banks in Spain will offer crypto-assets to their clients, marking a milestone in the integration of these digital assets into the traditional financial system. While some institutions had already been operating with crypto-assets through their foreign subsidiaries, Spanish banks have waited for the entry into force of the Crypto-Assets Markets Regulation, known as MiCA (Markets in Crypto-Assets Regulation), to launch their full offering in the domestic market.
This advancement will be possible thanks to the implementation of MiCA, which, starting from January 1, 2025, will establish a solid and secure regulatory framework for crypto-assets in the European Union. MiCA will provide the necessary legal foundations to manage the risks associated with the volatility of these assets, defining new standards of transparency and protection for investors, thereby strengthening trust in a market that has so far been marked by regulatory uncertainty.
2. Changes in requirements for crypto-asset service providers in Spain
2.1 Pre-MiCA requirements
Until now, regulation in Spain for cryptocurrency custody and exchange platforms was limited to money laundering prevention. Platforms that exchanged cryptocurrencies for fiat money only needed to register with the Bank of Spain to comply with anti-money laundering regulations. There was no specific framework regulating transparency, investor protection, risk management, or the operations of crypto-asset service providers.
2.2 New compliance requirements with MiCA
With MiCA, the regulation of crypto-assets in the European Union expands significantly. Starting in 2025, crypto-asset service providers in Spain will be required to comply with an authorization process that demands thorough controls and ongoing assessments. MiCA introduces a licensing system that evaluates the robustness of risk management systems, informational transparency, and investor protection.
Obtaining this license will not be a one-time procedure. MiCA establishes the obligation to maintain ongoing compliance, meaning that entities must have compliance and legal advisory teams to respond to periodic assessments by regulatory authorities. These teams will need to ensure that the entity’s policies on custody, storage, and transfer of crypto-assets meet the established regulatory standards.
2.3 Accelerated authorization procedure for banks
MiCA provides for a more streamlined authorization procedure for already regulated financial entities, such as banks, brokerage firms, and asset management companies, wishing to offer crypto-asset services. These institutions, operating under strict financial standards within the European framework, will be able to access an expedited authorization process. This simplified procedure facilitates banks’ entry into the crypto-asset market, giving them a competitive edge over new crypto service providers.
3. MiCA: Regulation for Risk Management in Crypto-Assets
The MiCA Regulation imposes strict rules for the management of specific risks in crypto-assets, establishing:
- Financial Risk Management and Control: MiCA requires entities to have robust control mechanisms to mitigate the financial risks associated with crypto-assets, including financial reserves to cover potential losses and clear policies for the valuation and management of these assets.
- Transparency and Disclosure Obligation: Entities must provide investors with detailed information about the nature, risks, and characteristics of the crypto-assets they offer, enabling informed assessments and reducing exposure to losses due to volatility.
- Retail Investor Protection: MiCA introduces safeguards for retail investors, requiring crypto-asset issuers to outline the contractual obligations and rights of investors in relation to the speculative nature of these assets.
- Regulatory Oversight: The regulatory framework establishes continuous supervision by national authorities such as the CNMV in Spain and the ESMA in the EU, who will have the authority to intervene in cases of risk or regulatory non-compliance.
4. Specific Aspects in Crypto-Asset Transactions
With the entry into force of MiCA, banks are considering additional protective measures for their clients in the context of crypto-asset transactions. One practice observed internationally is the British system, which establishes a 24-hour waiting period before an investment order is finalized. This reflection period allows clients to reconsider their investment decisions and, if necessary, cancel the order before execution. Although MiCA does not require this measure, some banks in Spain are evaluating the possibility of implementing it as an additional safeguard for their clients.
4.1 Potential for Mandatory Regulation by ESMA and CNMV
Under the MiCA framework, both ESMA (European Securities and Markets Authority) and CNMV (National Securities Market Commission) have the ability to impose additional guidelines and regulations that could make these protective practices mandatory. As the European regulator, ESMA has the authority to issue binding technical standards and implementing rules to ensure consistent application of MiCA across all member states. These guidelines could include specific rules on the waiting period or other transaction procedures, and once approved, they would be mandatory for compliance across the European Union.
The CNMV, as the supervisor in Spain, has the ability to apply these guidelines at the national level and, additionally, to develop regulations tailored to the specific Spanish context. This allows it not only to make ESMA’s recommendations mandatory but also to impose additional requirements in areas that MiCA does not cover in detail. This approach provides flexibility for the CNMV to respond quickly to the particularities of the Spanish market and any investment practices that are perceived as risky for investors.
4.3 Supervision and Intervention by ESMA and CNMV
Both ESMA and CNMV have supervisory and intervention powers in the event that significant risks to financial stability or investor protection are identified. ESMA can issue warnings and impose temporary market intervention measures in the crypto-asset market if it detects practices that pose a high risk. Meanwhile, the CNMV has the authority to implement additional regulations in Spain if it deems necessary to safeguard investors’ interests.
The MiCA Regulation represents a significant step forward in the regulation of crypto-assets in European banking, providing an unprecedented level of legal certainty and investor protection in this market. For Spanish banks, this framework will allow the development of financial products based on crypto-assets within a controlled system, meeting specific regulatory requirements and strengthening the stability of the financial system.
In our firm, we are committed to assisting financial institutions and companies in adapting to the new obligations of MiCA, providing specialized advisory services for compliance with this regulation and optimizing their strategies in the crypto-asset environment.
