MiCA Compliance Documentation 2024: Ensuring CASPs Meet EU Regulatory Standards

The Markets in Crypto-Assets Regulation (MiCA) coming into force at the end of 2024, mandates comprehensive and stringent compliance measures for all crypto-asset service providers (CASPs) within the EU. MiCA aims to standardize regulatory frameworks across the EU, enhancing market integrity, consumer protection, and operational transparency. A pivotal requirement is that CASPs must hold their share capital in a recognized credit institution. Demire Inc offers a rapid and reliable solution to this requirement, ensuring CASPs can meet this critical compliance component efficiently.

Understanding MiCA: What It Means for Crypto-Asset Service Providers

MiCA regulation establishes a harmonized framework for crypto-assets across EU member states, aiming to enhance market integrity and consumer protection. This unified approach addresses various aspects of the crypto industry, from issuance to custody, and sets out stringent operational standards for CASPs.

Key Requirements of MiCA:

• Capital Adequacy: Ensuring CASPs have sufficient capital to withstand financial instability.

• Operational Transparency: Mandating clear operational procedures and business practices.

• Consumer Protection: Enhancing safeguards for crypto investors and users.

• Governance and Oversight: Requiring robust internal controls and management processes.

The Role of Share Capital in MiCA Compliance

A critical component of MiCA compliance is the requirement for CASPs to secure their share capital in recognized credit institutions. This measure is designed to protect businesses and their clients by ensuring financial stability and operational resilience.

Understanding the Documentation Requirements Under MiCA

MiCA outlines specific documentation that CASPs must maintain to demonstrate compliance. Here are the key documents required at each stage of the compliance process:

Step 1: Business Plan Revision

Objective: Update your business plan to reflect MiCA-specific strategies.

Documentation Required:

• Articles of Association (62(2)(c) p.)

• Operational Program (62(2)(d) p.)

• Proof of Meeting Minimum Capital Requirements (62(2)(e) p.)

• Description of Prudential Requirements and 3-Year Implementation Projections (62(2)(e) p.)

Step 2: Crypto-Asset Services Strategy

Objective: Detail your current and planned services, ensuring compliance with MiCA standards.

Documentation Required:

• Crypto-asset Custody and Administration Policy (62(2)(m) p.)

• Crypto-asset Pricing Methodology Description (62(2)(o) p.)

Step 3: Governance Optimization

Objective: Enhance governance frameworks to support compliance and oversight.

Documentation Required:

• Organizational Structure Description (62(2)(f) p.)

• Internal Control Policy (62(2)(f) p.)

Step 4: Management Compliance Verification

Objective: Conduct background checks and reviews for all managers and key shareholders.

Documentation Required:

• Resumes and Qualifications of Key Personnel (62(2)(f) p.)

• Information and Documents on Management and Supervisory Bodies (62(2)(g) p.)

Step 5: Outsourcing Oversight

Objective: Regulate third-party outsourcing to meet MiCA’s data protection and operational resilience requirements.

Documentation Required:

• Breach Reporting Procedures Description (62(2)(f) p.)

Step 6: ICT System Upgrades

Objective: Upgrade ICT systems to comply with the Digital Operational Resilience Act (DORA).

Documentation Required:

• IT Systems Description (62(2)(f) p.)

• Technical Documentation and Description of IT Systems and Security Measures (62(2)(j) p.)

Step 7: Asset Protection Mechanisms

Objective: Enforce rules for segregating client funds as mandated by MiCA.

Documentation Required:

• Procedures for Separation of Client Crypto-assets and Funds (62(2)(k) p.)

Step 8: Enhanced Financial Controls

Objective: Strengthen financial reporting and monitoring systems.

Documentation Required:

• Accounting Policy (62(2)(f) p.)

Step 9: Compliance Policy Updates

Objective: Revise internal policies to align fully with MiCA regulations.

Documentation Required:

• Anti-Money Laundering and Terrorist Financing Prevention Policy (62(2)(i) p.)

• Business Continuity Policy (62(2)(i) p.)

• Complaints Handling Procedure (62(2)(l) p.)

Demire Inc's Unique and Rapid Account Opening Service

Demire Inc specializes in the expedited setup of compliant financial accounts for CASPs, addressing the critical requirement to hold share capital in a recognized credit institution.

Our services include:

• Rapid Account Setup: We establish required accounts within 1-2 weeks, significantly faster than the industry standard.

• Focused Expertise: Tailored services to meet the stringent requirements of MiCA, ensuring comprehensive compliance.

• Deadline Awareness: With a compliance deadline of July 31st this year, our timely service ensures that your business is fully compliant without last-minute pressures.

Conclusion:Why Choose Demire Inc for MiCA Compliance?

With MiCA's implementation date on the horizon, partnering with an experienced compliance specialist like Demire Inc can make the difference between merely meeting regulatory requirements and excelling in a newly regulated environment. Our fast, reliable, and comprehensive services ensure that your business not only adheres to the regulations but is also positioned for growth and success in the evolving EU crypto market.