Requirements for crypto-asset services have tightened with the MiCA Regulation – consumers still need to be careful

The EU Regulation on Markets in Crypto-Assets became fully applicable on 30 December 2024. The Regulation requires crypto-asset service providers to comply for the first time with many of the requirements established in financial markets, such as rules related to management competence, own funds, data transparency and information security. Although the MiCA Regulation is now officially in force, companies already operating in the market have been granted transitional periods, which vary across Europe. The six-month transitional period applied in Finland is one of the shortest; in many other countries, the transitional periods last 12–18 months.

“This means that consumers purchasing crypto-assets or crypto-asset services from outside Finland should be careful, as the level of regulatory requirements will vary significantly between countries during the transitional period. It is also important for consumers to note that MiCA does not provide protection for services purchased outside the EU and EEA. If crypto-assets or crypto-services are purchased from outside the EU, regulations may differ considerably,” says FIN-FSA Director General Tero Kurenmaa.

The risks associated with crypto-assets, such as high volatility, scams and security threats, remain significant. MiCA, moreover, does not oblige service providers to assess the suitability of services or products for customers, nor are their activities covered by the Investors’ Compensation Fund.

Eight authorisation applications received by FIN-FSA

There have been 13 registered virtual currency providers in Finland. If registered virtual currency providers wish to continue their activities after 30 June, they must obtain authorisation of a crypto-asset service provider under MiCA. The FIN-FSA has received applications for authorisation under MiCA to provide crypto-asset services from eight companies. These applications are currently being processed.

“It’s worth remembering that the MiCA Regulation does not eliminate all risks associated with crypto-assets, such as cybersecurity concerns and high volatility. A high proportion of the crypto-asset contacts we receive are about scams. It is still not a good idea to make a purchasing decision without checking the background of the service provider, and consumers should be able to take their time when considering the decision,” says Head of Division Maria Rekola.

Ten funds have either restricted or suspended redemptions

The supervision of crypto-asset operators was discussed at the FIN-FSA press conference on 3 April. The event also included a review of developments in the fund sector. The net asset value of Finnish funds was EUR 205 billion at the end of 2024. For real estate funds, in particular, the last year has been challenging, with net redemptions and revaluations negative in 2024. From 2023 onwards, open-ended real estate funds have reduced redemption frequency and expanded the use of liquidity management tools. As the liquidity situation of funds deteriorated, a total of ten funds either restricted or suspended redemptions.

 “The role of the FIN-FSA in fund supervision is to ensure investor protection, both for redeemers and remaining unit-holders, as well as market stability. This year, our supervision will focus particularly on liquidity management and stress tests, use of debt capital, and valuation. In addition, new regulations are being prepared at EU level,” says Head of Division Marko Hovi.

Other topical issues discussed at the FIN-FSA press conference on Thursday were the real estate sector risks of banks and the financial situation and risks of supervised entities.

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Attachments

Press conference presentation material (in Finnish)