ESMA Cracks Down on Crypto Firms with Resilience and Substance Priorities
Europe's financial regulator is taking its oversight of cryptocurrencies to the next level. The European Securities and Markets Authority (ESMA) has listed digital operational resilience as a top priority for crypto-asset service providers in its 2027 Annual Work Programme.
This means ESMA will focus on ensuring that these firms can withstand cyber attacks and other disruptions to their services. Other key areas of focus include corporate substance, outsourcing risks, liquidity in the EU crypto market, reverse solicitation, and asset classification.
ESMA Chair Verena Ross told the European Parliament's Economic and Monetary Affairs Committee that the focus has shifted from rulemaking to supervision and supervisory convergence since the entry into application of the Markets in Crypto-Assets (MiCA) regulation. She emphasized the importance of providing clarity for firms, safeguards for investors, and confidence for the market.
One of ESMA's tools to achieve this is its MIDAS system, which will be fully operational by 2027. This system supports national authorities' monitoring of market abuse and will help them identify potential threats.