The European Regulation on Crypto-Asset Markets (MiCA) establishes for the first time a common regulatory framework for crypto-assets in the European Union. The regulation sets rules for their issuance and for the provision of services related to these assets, such as buying and selling or custody, and introduces requirements for providers operating in the market. Its aim is to strengthen investor protection, provide legal certainty to the sector, and establish uniform rules for operating across the EU.
The entry of traditional banking into the crypto-asset market faced a fundamental obstacle: the lack of legal certainty. It was not so much a technological issue as the absence of a clear framework regarding licenses, custody, or responsibilities. MiCA changes this scenario.
We are already seeing movements in this direction. BBVA, after initiating the buying and selling and custody of bitcoin and ether from its Swiss subsidiary, obtained approval from the CNMV to offer these services to individual clients in Spain.
The transformation of the financial system will not be consolidated solely from the bottom up, driven by decentralised communities. Traditional financial institutions will also have a decisive role as catalysts for large-scale adoption. MiCA, along with the DLT Pilot Regime and DORA, allows for progress towards a convergence between traditional and decentralised finance that will be hybrid, regulated, and progressive.
Mass adoption will likely be led by regulated intermediaries and centralised structures, including traditional banks, but also by specialised platforms and new service providers in crypto-assets. The advantage of banks will be their ability to integrate digital assets into an already existing financial relationship supported by trust and protection mechanisms
This greater certainty also opens up an opportunity for Europe. We have a harmonised framework and a passport that allows operation throughout the internal market. However, regulation can be a double-edged sword: it provides legal certainty and can attract capital and institutional investors, but excessive regulation or too slow an application can limit the ability to compete against markets like the United States or more dynamic Asian jurisdictions.
Europe will position itself better if it manages to ensure that its framework acts as an enabler and not as a brake, with reasonably quick authorisation processes and intelligently addressing areas that have been left out of MiCA, such as DeFi or NFTs.
Spain also has an opportunity. Of the 128 entities authorised to operate, only fifteen are based in our country and have direct authorisation from the CNMV. This data shows that the European passport works, but also that we are, for now, more of a destination market than a country of origin for these providers. The risk is becoming consumers of regulated innovation from other member states instead of generating it here.
We are not starting from scratch. Spain was a pioneer with its regulatory sandbox and there are already experiences in the tokenisation of funds, securities, and real estate assets on which to build.
To establish ourselves as a European hub, three things are needed: supervisory agility, with competitive timelines and costs compared to other jurisdictions; leveraging our position in the tokenisation of real assets, especially in areas such as real estate, funds, or energy; and intensifying collaboration between banks, fintechs, universities, and regulators, which we are already seeing in Madrid and Barcelona.
The window of opportunity is open, but not indefinitely. Having a solid legal framework is important, but not sufficient. The European hub will go to whoever can combine legal certainty with speed of execution.
