ESMA has mandated that unlicensed crypto firms exit the EU by July 1, affecting thousands of users and traders.
The European Securities and Markets Authority (ESMA) has mandated that all cryptocurrency companies operating without a Markets in Crypto-Assets (MiCA) license must cease operations for EU clients by July 1.
As part of this directive, the regulator has asked these service providers to create and submit wind-down plans ahead of the deadline.
Legal experts from Hogan Lovells reported that, as of May, only 194 companies had obtained the necessary approvals, representing a mere fraction of the approximately 3,000 firms that previously operated in the region. It is anticipated that about 75% of these unlicensed platforms will either close down or exit the EU market entirely.
This situation will result in account restrictions for users, as unlicensed exchanges will halt deposit acceptance and require customers to withdraw their funds.
Traders in France are expected to face the most significant challenges, as local authorities have warned that violators could face criminal charges and hefty fines.
The MiCA regulations are already affecting the stablecoin sector, with major exchanges like Binance and Kraken beginning to delist USDT due to non-compliance. In its place, regulated tokens such as USDC are gaining traction.
Additionally, in early June, a memorandum of understanding was signed between the New York State Department of Financial Services and the European Banking Authority, aimed at collaborative oversight of the stablecoin market.
