ESMA calls on unlicensed crypto-asset service providers to cease operations by end of transition period

24 June 2026

Crypto-assets

The European Securities and Markets Authority (ESMA) expects that crypto-asset service providers (CASP), which will not have regulatory authorization at the end of the transition period under the Markets in Crypto-Assets Regulation (MiCA) on 1 July 2026, will cease providing services related to crypto-assets to clients.

More CASPs will obtain authorization by 1 July 2026, while other entities, including significant providers currently offering services to clients in the EU, may not have obtained authorization from the competent supervisory authority by the deadline. In such cases, ESMA expects that unlicensed providers of services related to crypto-assets will immediately take measures to cease their activities in the EU, thereby protecting client interests and reducing risks to the market.

Unlicensed providers of services related to crypto-assets must, in particular:

• Immediately cease acquiring new EU clients; they must refrain from activities related to opening accounts and establishing business relationships with new clients, and must cease marketing activities and client outreach.

• Limit the provision of services to actions necessary for the sale or transfer of crypto-assets, the redistribution of assets, or the closing of positions. Custody of client crypto-assets may continue only for the period strictly necessary to complete an orderly exit.

• Communicate clearly, promptly, and repeatedly with clients (both natural persons and institutional investors) regarding measures taken to protect their assets and plans for liquidation, so that clients are aware of the timeframe for selling, transferring, redistributing, or closing their positions.

Wind-down procedures must be carried out in accordance with all relevant EU laws or national regulations regarding the prevention of money laundering and terrorist financing (AML/CFT). In particular, crypto service providers should maintain effective AML/CFT controls throughout the liquidation process, including customer due diligence measures, transaction monitoring, verification of restrictive measures and sanctions lists, reporting of suspicious transactions and activities, record-keeping requirements, and compliance with applicable obligations regarding asset transfers and traceability of crypto-asset transfers. ESMA expects that unlicensed providers of services related to crypto-assets will act diligently in protecting clients.

If an unlicensed provider of services related to crypto-assets transfers clients to a CASP provider authorized by a competent EU authority, the provider taking over the clients must carry out all necessary onboarding procedures, including customer due diligence and all other AML/CFT checks required by the applicable legal framework.

ESMA also reminds crypto service providers based outside the EU that they cannot provide services to EU clients under MiCA or solicit them. This applies also in the context of business-to-business operations. In this regard, ESMA reminds that MiCA prohibits CASP providers from outsourcing or transferring certain services, particularly custody, to entities that do not hold authorization from a competent EU authority to provide services related to crypto-assets.

Warning to investors

Clients of unlicensed providers of services related to crypto-assets, regardless of whether they are entities from within or outside the EU, cannot be entitled to protective measures under MiCA, including protection of their assets.

Therefore, ESMA calls on clients using services related to crypto-assets in the EU to check whether their provider is authorized in accordance with MiCA and is listed in the ESMA register. If not, they should take immediate action, including transferring their crypto-assets to a licensed CASP. In case of difficulties, clients should contact their provider.

ESMA and competent national authorities are directly cooperating with the relevant entities and will coordinate in monitoring whether significant unlicensed cross-border providers of services related to crypto-assets immediately cease operations, with a focus on protecting investors, financial stability, and market integrity.

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