MiCA Review: EU Regulators Aim to Balance Risk and Compliance Costs

The European Union's Markets in Crypto-Assets (MiCA) regulation has achieved a significant milestone by creating a unified rulebook for crypto asset services across the EU and EEA. The focus is now shifting from implementing this framework to stress-testing it through its scheduled review, which closes on September 30.

The MiCA framework was designed to bring coherence to the fragmented market, allowing authorized providers to passport their services across Member States. This has created a larger addressable customer base and reduced duplication for providers. However, compliance costs have risen, with smaller firms and new entrants bearing the brunt of fixed costs.

The review aims to simplify requirements that add burden without clear risk-reduction benefits. Proponents argue that regulation should follow risk, focusing on services involving client money, custody of assets, or threats to market integrity. The goal is to maintain strong oversight where risks are highest while reducing duplicative costs and preserving EU market attractiveness.