The European Securities and Market Authority (ESMA) has released an updated Q&A regarding specific guidelines, including providing crypto staking services under MiCA.
According to the European securities regulator, the Markets in Crypto Asset Regulation does not prohibit staking features for crypto firms. Due to the absence of specific provisions for staking in the MiCA, a minor controversy arose. This implies it does not prohibit the service or establish explicit regulations, as in other regions.
ESMA asserts that the staking service providers directly enforce the regulations, rendering staking an ancillary service to their primary custody services.
“The staking service provider holds the crypto assets, or the private keys that grant access to them, in custody during the provision of staking services.”
Consequently, the provision of plotting services is ancillary to custody services, which are eligible for coverage under MiCA. Subsequently, the crypto asset staking service provider certification under MiCA is mandatory.
This directly subjects firms to Article 75 MiCA and other regulations that mandate the custody and administration of crypto assets. Staking has raised concerns among regulators and authorities in numerous jurisdictions.
In particular, the United States Securities and Exchange Commission (SEC) has filed numerous lawsuits against firms that provide staking features and has flagged staking services.
CASPs to adhere to disclosure requirements.
In cases where crypto asset service providers provide staking features in addition to asset custody, they are required to guarantee that digital assets can be returned following the agreement, as stated in the release.
Subsequently, the loss of assets is the responsibility of Art. 75(8) MiCA. Additionally, CASPs must obtain explicit consent from users to stake their crypto assets when staking services are conducted concurrently with custody. This is because staking services affect the user’s capacity to access their crypto assets.
