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The European Union has made it clear: crypto is now part of the regulated financial system. With MiCA finally in place, crypto-asset service providers, CASPs, have to meet the same kind of expectations that apply to any other financial firms.

The ESMA goal is simple: make authorization consistent across the European Union. ESMA wants all regulators to apply the same standards, whether a company applies in Paris, Madrid, or Vilnius. A firm that wants a license will need people, systems, and real decision-making power inside the EU.

According to the ESMA approach, there are no low-risk CASPs. Crypto companies, even the small ones, often operate without the layers of control that exist in traditional finance. In the conventional system, several intermediaries are between the client and the market: banks, custodians, transfer agents, and nominee account structures. Each of them performs checks, records transactions, and provides a degree of transparency and accountability. Client assets are normally held through segregated accounts, and their movements pass through multiple controlled systems subject to reconciliation and oversight.