Central Bank of Ireland publishes dedicated FAQ page on MiCA

The FAQ page detailed the below information under the following FAQ  headings:

1. Authorisations

The Central Bank outlined that Virtual Asset Service Providers (“VASPs”) that are registered with the Central Bank are requested to engage with their supervisor to arrange a CASP early engagement meeting, with VASPs that are currently seeking registration encouraged to contact their Central Bank contact point.

In relation to timelines for a CASP application, the Central Bank did not give any definite timelines but stated that any timelines will be dependent on the specifics of each case, with best-prepared firms often proceeding more efficiently.

2. Expectations

The Central Bank stated that it is working with EU colleagues through supervisory coordination networks to build convergence around authorisation and supervisory expectations and processes.  The Central  Bank added that its expectations and processes have been developed based on the MiCA level 1 text and the supporting technical standards and guidelines that are currently nearing finalisation.

The Central Bank stated that VASPs seeking to become MiCA authorised CASPs, must go through the full application process and will be subject to a robust assessment to ensure it will meet both its obligations under MiCA and the Central Bank’s supervisory requirements.  However it should be noted that the Central Bank did state that where there is a pre-existing relationship between the regulated entity and the Central Bank, all supervisory knowledge will be taken into account as part of any authorisation assessment.

3. Policy

The Central Bank  stated that the simplified procedure under Article 143(6) of MiCA is only applicable when the following conditions are fulfilled: the entity was authorised to provide crypto-asset services under national law before 30 December 2024 and when a National Competent Authority (“NCA”) ensures that Chapters 2 and 3 of Title V of MiCA are complied with prior to granting any authorisation.  The Central Bank added that registration under the AML/CFT framework should not be considered as sufficient to qualify for the aforementioned simplified procedure.

The Central Bank noted a recent statement from the European Banking Authority, that outlines that firms listing stablecoins should ensure compliance as soon as possible and refrain from carrying out non-compliant services by 30 June 2024. The Central Bank stated that it expects that firms listing any stablecoins that are not compliant with MiCA to implement these actions as soon as possible and such firms should aim to complete this work by year-end 2024.

The Central Bank did not comment on its position in relation to CASPs utilising trading and execution venues in non-EU jurisdictions.  However it did ask the reader to refer to a recent ESMA Opinion on this point. For more details please see the FIG Top 5 at 5 dated 8 August 2024.

The Central Bank noted that a CASP may provide crypto-asset services on a cross-border basis, subject to a CASP submitting the specified information in the FAQ document to its NCA.

4. VASPS

In relation to VASPs which are not seeking a MiCA licence, the Central Bank stated that they will not have any passporting rights under the Irish VASP regime to provide their services in other jurisdictions and that any VASP not intending to apply for a MiCA authorisation should establish clear wind-down plans and make arrangements to cease providing services by the end of the transitional period adopted by the Department of Finance.

Observations

This publication is a welcomed insight into the Central Bank’s position on a number of areas regarding MiCA.  Importantly, the publication clearly outlines the importance of a well prepared CASP application.  A particular point of interest and reassurance for potential CASP applicants, is the statement by the  Central Bank that a pre-existing relationship will be taken into account as part of any authorisation assessment.