Introduction
The Markets in Crypto-Assets (MiCAR) regulation represents a significant milestone in the European Union's approach to the burgeoning crypto-asset sector. This landmark framework, established by the European Commission, focuses on maintaining financial stability, safeguarding investors, and fostering transformative growth within the EU's crypto landscape (1). Understanding MiCAR is now paramount for any entity operating within or targeting the European crypto market—especially concerning how assets and related services are communicated and marketed to the public.
MiCAR's journey from inception to enforcement has been a phased one. Following its publication in the Official Journal of the European Union in June 2023, the regulation set forth staggered compliance timelines. Titles III and IV, which address asset-referenced tokens (ARTs) and e-money tokens (EMTs), became applicable in June 2024 (2). All other provisions of MiCAR will be fully applied by December 2024 (2). This phased approach places immediate demands on businesses dealing with ARTs and EMTs, while the broader crypto market must urgently prepare for the regulation's full application.
Understanding MiCAR: Scope and Definitions
MiCAR is an EU-level regulatory framework originating from the European Commission (2). Its primary objective is to harmonize and unify the regulatory approach to crypto-assets across all 27 EU member states. MiCAR applies to any Crypto-Asset Service Provider (CASP) that offers services within the EU, regardless of its home jurisdiction (2).
The regulation categorizes crypto-assets into three main groups (1):
- Asset-Referenced Tokens (ARTs): Tokens meant to maintain a stable value by referencing other assets or rights.
- E-money Tokens (EMTs): Tokens referencing the value of a single official currency.
- Other Crypto-Assets: Tokens that do not meet the definitions of ARTs or EMTs.
Certain crypto-assets are excluded from MiCAR, including those classified as financial instruments under MiFID II, as well as non-fractionalized Non-Fungible Tokens (NFTs). MiCAR defines CASPs as entities that professionally offer services such as custody, exchange, or trading platforms for crypto-assets, among others (2). Because of its cross-border application, MiCAR has far-reaching global implications for crypto businesses that serve or solicit EU clients.
Defining "Market Communications" in the Context of MiCAR
MiCAR does not explicitly define the term "market communications." However, based on the recitals and guidance from comparable regulations, it broadly includes any promotional or marketing content disseminated via traditional channels, social media, or other digital platforms (9). Similar to existing financial regulations (e.g., MiFID II), MiCAR requires that all market communications be fair, clear, and not misleading (6).
A practical interpretation is that any content promoting crypto-assets or related services qualifies as "market communications." Consequently, crypto businesses should maintain a principled approach to all promotional activities, ensuring that every message is transparent, accurate, and aligned with MiCAR's investor protection goals.
Key Requirements and Obligations for Crypto-Asset Service Providers (CASPs)
Under MiCAR, CASPs must act honestly, fairly, and professionally, keeping the best interests of their clients in mind (5). Specific requirements include:
- Fair, Clear, Not Misleading Information: All marketing communications must provide accurate, balanced information. CASPs must highlight the risks of investing in crypto-assets (5).
- Transparent Fee Policies: CASPs must disclose fees prominently on their websites (5).
- Climate/Environmental Disclosures: CASPs must disclose principal adverse impacts on the climate and environment stemming from their consensus mechanisms (5).
- White Paper Access: CASPs operating trading platforms or offering advisory/portfolio management services must provide direct hyperlinks to the relevant crypto-asset white papers (3).
- Complaint Handling: CASPs must establish transparent procedures for addressing client grievances and keep records of complaints and resolutions (3).
- Conflict of Interest Management: CASPs must disclose and manage conflicts of interest, publishing policies on their websites in a format accessible to all clients (2).
These requirements underscore MiCAR's aim of promoting transparency and fostering trust between CASPs and the investing public. Additionally, CASPs should note that national rules on financial promotions and advertising may also apply, particularly when working with social media influencers or "finfluencers."
Obligations for Issuers of Crypto-Assets
Issuers of Asset-Referenced Tokens (ARTs), E-money Tokens (EMTs), and other crypto-assets must also comply with detailed communication requirements (6).
- ARTs and EMTs: Any communication must be easily identifiable as marketing, fair, clear, and consistent with the crypto-asset's white paper. It must also indicate the website and contact details of the issuer, highlight the right of redemption, and be published on the issuer's website (16).
- Other Crypto-Assets: Similar requirements apply, including the need for clear disclosures and references to the white paper. Additionally, marketing materials must include a prominent statement that they have not been reviewed or approved by any EU authority (9).
Crucially, issuers must update their white papers and any related marketing communications if there are significant new factors or inaccuracies affecting the valuation of the crypto-assets (9).
Challenges and Implications for Crypto Businesses
Adapting to MiCAR's marketing rules can be complex, especially for businesses with established promotional strategies (1):
- Legal Reviews: Existing marketing content may need comprehensive legal scrutiny to align with MiCAR, potentially increasing operational costs (10).
- Continuous Updates: Issuers must remain vigilant for material changes requiring updates to both the white paper and marketing messages (9).
- Cross-Border Complexity: Non-EU entities still targeting the EU market need to comply with MiCAR's rules, potentially establishing an EU-based registered office (2).
Despite these challenges, aligning marketing practices with MiCAR fosters transparency and can build greater trust, both of which are crucial for industry growth.
Best Practices and Guidelines for MiCAR-Compliant Market Communications
As MiCAR rolls out, several best practices have emerged (8):
- Internal Review Processes: Establish robust procedures to vet all marketing materials for consistency with the crypto-asset white paper.
- Mandatory Disclosures: Include the required disclaimers, white paper references, and any other relevant legal statements in each marketing piece.
- Collaboration and Training: Foster close cooperation among marketing, legal, and compliance teams. Provide specialized training on MiCAR's requirements.
- Non-EU Entities: Carefully assess all engagement with EU residents to avoid inadvertently soliciting clients without full MiCAR compliance (11).
Staying informed about evolving industry standards and emerging ESMA or EBA guidelines will help firms adapt more smoothly to MiCAR's regulatory landscape (3).
Consumer Protection and Market Integrity through Communication Rules
MiCAR's rules on market communications play a central role in safeguarding consumers and ensuring market integrity (1):
- Preventing Misinformation: By demanding fair, clear, and accurate communications, MiCAR reduces the risk of misleading promotions (6).
- Risk Disclosures: Mandated risk warnings help consumers understand the potential volatility and downsides of crypto investments (5).
- Liability for Misleading Statements: Issuers are liable for incorrect or incomplete information in their white papers (5).
Combined with other MiCAR provisions—including market abuse rules and a 14-day withdrawal right for retail investors—these communication requirements reinforce a fair, transparent environment aimed at fostering investor confidence.
Regulatory Interpretations and Clarifications
European authorities such as ESMA and the European Banking Authority (EBA) have been issuing additional guidance on how MiCAR applies in practice (3). One notable topic is "reverse solicitation," wherein ESMA has provided a strict interpretation to prevent non-EU firms from evading MiCAR's authorization requirements (11).
Additionally, ESMA and EBA maintain registers of notified crypto-asset white papers and authorized CASPs, helping stakeholders identify compliant entities and offerings (3). This level of transparency supports both consumer protection and the integrity of the crypto market.
Conclusion: Ensuring Compliance and Building Trust in Crypto Marketing
MiCAR's comprehensive marketing communication rules mark a pivotal development in the EU's regulatory stance on crypto-assets. For Crypto-Asset Service Providers and issuers alike, adherence to requirements around honesty, clarity, and detailed disclosures is now essential. Although the road to full MiCAR compliance may introduce operational challenges—such as higher legal costs and rigorous content reviews—the regulation also offers an opportunity to elevate industry standards. By embedding transparency and consumer protection into every aspect of their marketing strategies, crypto businesses can cultivate trust, reduce risk, and bolster the sector's long-term sustainability within the European market.
| Feature | ARTs & EMTs | Other Crypto-Assets |
|---|---|---|
| Identifiable as Marketing | Yes | Yes |
| Fair, Clear, Not Misleading | Yes | Yes |
| Consistency with White Paper | Mandatory | Mandatory |
| Mandatory Disclaimers | Reference to redemption rights | Statement that it hasn't been approved by EU authorities |
| Publication Venue | Issuer's website | Offeror's/Operator's website |
| Timing of Dissemination | Not before white paper publication | Not before white paper publication |
| White Paper Notification | 20 working days before publication (for ART/EMT issuance), or approval in certain cases | 20 working days before publication |
Works Cited (Linked Sources)
- What Is Markets in Crypto-Assets (MiCA)? - Investopedia
- The EU Markets in Crypto-Assets (MiCA) Regulation Explained
- Markets in Crypto-Assets Regulation (MiCA) - ESMA
- Markets in Crypto Assets Regulation (MiCAR) - Central Bank of Ireland
- The European regulation Markets in Crypto-Assets (MiCA) - Autorité des marchés financiers
- European crypto-assets regulation (MiCA) | EUR-Lex
- Markets in Crypto-Assets (MiCA/MiCAR) - CSSF
- Marketing Crypto-Assets in and Into Europe: MiCAR - Goodwin Procter
- MiCAR: Marketing Rules for Crypto-assets - Futura Law Firm
- New Era of Crypto Regulation - Understanding MiCA's Framework | Chambers
- Marketing Crypto Assets to EU Investors Under MICA: Reverse Solicitation | Goodwin
- Guide to the MiCA Regulation – Markets in Crypto-Assets Act - CrustLab
