EU Council to place major crypto providers under ESMA oversight

The EU Council has agreed to place the most significant cross-border crypto-asset service providers (CASPs) under the direct supervision of the European Securities and Markets Authority (ESMA). This move aims to tighten oversight across national markets by shifting the most impactful providers from home-country supervision to an EU-level authority, while smaller providers will generally remain under national regulators.

This approach narrows the current passporting system established under the Markets in Crypto-Assets (MiCA) regulation. While the negotiating position does not immediately change MiCA requirements, it introduces a two-year transition period for experts to transfer supervisory responsibilities. The Council has not yet specified the exact thresholds, such as user counts or assets under custody, that will determine which firms qualify as “most significant.”

In terms of current implementation, Germany leads the EU in MiCA-authorized providers with 89 licenses, followed by France with 35 and the Netherlands with 29. However, industry observers note that license counts may not accurately reflect where the underlying crypto infrastructure is being built, as the MiCA framework allows authorized firms to operate across the bloc regardless of their home jurisdiction.