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ESMA

ESMA

European Securities and Markets Authority

High Impact

ESMA tells unauthorised CASPs to wind down EU crypto-asset services as MiCA transitional period ends

Published

Jul 31, 2026

Effective

Jul 1, 2026

Topics

MiCA, Crypto-asset service providers, CASP authorisation, Wind-down, Client asset protection, AML/CFT, Reverse solicitation, ESMA Register

Executive Summary

ESMA has issued a public statement setting supervisory expectations for crypto-asset service providers that remain unauthorised when the MiCA transitional period ends on 1 July 2026. ESMA expects unauthorised CASPs, including non-EU firms and significant providers operating under prior national regimes, to wind down EU activities without delay while protecting clients and market integrity. The statement requires an immediate stop to new EU client onboarding, marketing and solicitation, and restricts continuing services to steps necessary for clients to sell, transfer, reallocate or close positions. Custody may continue only for the period strictly necessary to complete an orderly exit. Firms must communicate repeatedly and clearly with retail and institutional clients, including wind-down timelines, residual-position deadlines and client-protection information. AML/CFT, sanctions screening, transaction monitoring, suspicious activity reporting, record-keeping and crypto-transfer traceability controls must remain effective throughout. The impact is high for unauthorised CASPs and for authorised CASPs receiving transferred clients, which must complete onboarding and due diligence under applicable requirements.

What Changed

newMandatory orderly wind-down for unauthorised CASPs

Previous

During the MiCA transitional period, certain CASPs that had provided services before MiCA’s application could continue operating under applicable national transitional arrangements until 1 July 2026 or an earlier authorisation/refusal outcome.

New

After 1 July 2026, unauthorised CASPs are expected to wind down EU activity without delay rather than continue providing MiCA services to EU clients.

newImmediate stop to EU onboarding and solicitation

Previous

The statement identifies that some providers were still servicing EU clients under national regimes during the transitional period.

New

No new EU client relationships, accounts, marketing or solicitation should continue for unauthorised CASPs.

newServices limited to exit-only activity

Previous

CASPs under transitional arrangements could provide services within the limits of applicable national regimes before the deadline.

New

Service provision is restricted to exit-related activity, with custody only as long as strictly necessary to complete the wind-down.

newClient communications must include wind-down details

Previous

No specific ESMA wind-down communication expectation applied to unauthorised CASPs solely by virtue of the approaching end of the transitional period.

New

Client communications should explain safeguarding measures, client actions, exit timelines, automatic closure deadlines and client-protection requirements.

modifiedNon-EU CASP and outsourcing perimeter emphasised

Previous

Reverse solicitation remains a narrow exception under MiCA guidance, and outsourcing/delegation requirements apply under MiCA.

New

ESMA has linked these perimeter controls directly to post-transitional enforcement and wind-down expectations for unauthorised CASPs.

Business Impact

Who is affected

Directly affected

crypto-asset service providers that are not authorised under MiCA by 1 July 2026, including EU and non-EU providers servicing or soliciting EU clients, and firms relying on prior national transitional regimes.

Indirectly affected

MiCA-authorised CASPs receiving transferred clients, retail and institutional EU clients of unauthorised CASPs, outsourcing and custody service chains, compliance, AML/CFT, sanctions, operations, legal and client-service teams.

Jurisdictions

European Union, European Economic Area where MiCA is applied through relevant arrangements or local implementation, Non-EU firms providing or soliciting MiCA services to EU clients

Business processes

EU client onboarding and account-opening controls, Marketing, solicitation and reverse-solicitation controls, Client wind-down, asset transfer, reallocation and position-closure workflows, Custody exit and client asset safeguarding controls, Client communications and complaints handling, AML/CFT customer due diligence, transaction monitoring, sanctions screening, suspicious activity reporting and record-keeping, Third-party outsourcing, delegation and custody due diligence

Estimated effort

High

Compliance risk

High

Affected Reports

EU client onboarding freeze control and exception logClient wind-down communication tracker, including residual-position closure deadlineClient asset transfer, reallocation and position-closure workflow evidenceCustody wind-down and safeguarding control fileAML/CFT and sanctions monitoring evidence during wind-down
FieldValidation rule

Recommended Actions

7 suggested next steps· derived from source analysis
  1. 1
    AI generatedStep 1 of 7

    confirm MiCA authorisation status and map all EU clients, accounts, marketing channels and service lines against the 1 July 2026 end of the transitional period.

  2. 2
    AI generatedStep 2 of 7

    immediately disable new EU onboarding, account-opening, paid acquisition, relationship-manager solicitation and affiliate/referral activity for any unauthorised CASP business.

  3. 3
    AI generatedStep 3 of 7

    implement an exit-only operating model that permits only sale, transfer, reallocation or closure activity, and document why any continuing custody is strictly necessary for orderly exit.

  4. 4
    AI generatedStep 4 of 7

    send repeated client communications explaining asset-safeguarding measures, available transfer or closure options, wind-down timeline, residual-position deadline and complaint/escalation channels.

  5. 5
    AI generatedStep 5 of 7

    maintain AML/CFT, sanctions screening, transaction monitoring, suspicious activity reporting, record-keeping and crypto-transfer traceability controls until all EU client positions and assets are exited.

  6. 6
    AI generatedStep 6 of 7

    where clients transfer to an authorised CASP, require the receiving CASP to perform onboarding, customer due diligence and other applicable AML/CFT checks rather than relying solely on legacy files.

  7. 7
    AI generatedStep 7 of 7

    review outsourcing and custody arrangements to ensure no MiCA service, notably custody, is outsourced or delegated to an entity that is not authorised as a CASP.

Timeline

other

May 31, 2023

Regulation (EU) 2023/1114 on markets in crypto-assets was adopted, establishing the EU MiCA framework including CASP authorisation and transitional provisions.

effective date

Dec 30, 2024

MiCA provisions for crypto-asset service providers became applicable, with transitional arrangements available under Article 143 for eligible pre-existing providers.

other

Apr 17, 2026

ESMA issued an earlier statement on the end of MiCA transitional periods, which the 23 June 2026 statement expressly builds on.

publication

Jun 23, 2026

ESMA published its public statement on orderly wind-down expectations for unauthorised CASPs as the MiCA transitional period ends.

effective date

Jul 1, 2026

End of the MiCA transitional period identified by ESMA; unauthorised CASPs are expected to wind down EU activity and cannot continue providing MiCA services to EU clients.

Sources

AI-generated analysis is based on the following primary sources. Always verify against the official publication.

Related Evidence

Verified source support for this analysis

The evidence agent checks whether the drafted finding is supported by official publications and relevant public source material.

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