Catenaa, Friday, June 06, 2025-The European Union’s landmark crypto regulation, Markets in Crypto-Assets (MiCA), is reshaping the continent’s digital asset industry, forcing smaller firms to either adapt to strict compliance or exit the market altogether.
Legal experts and industry insiders at the recent UN:BLOCK conference in Riga said MiCA, which aims to unify crypto regulation across the EU, is proving more challenging in execution than anticipated.
The legislation requires crypto companies to adopt governance practices akin to traditional financial institutions, including internal compliance policies, accounting systems, and outsourcing controls.
Rūdolfs Eņģelis, a partner at Sorainen, warned that many small players lack the resources to secure licenses and maintain ongoing compliance. He added that MiCA could further global regulatory fragmentation unless aligned with standards from other regions.
For many, the transition is more cultural than legal. Agneta Rumpa, senior associate at Sorainen, called MiCA a “true paradigm shift” for crypto-native teams, many of whom are unaccustomed to heavy regulatory oversight.
Still, Latvia is emerging as a leader in MiCA implementation. Fast-track licensing and political support have made it an attractive jurisdiction for crypto firms, experts said. In contrast, countries like Poland and Belgium are lagging behind due to delayed regulatory readiness.
While some in the industry hope MiCA will cement Europe as a crypto innovation hub, others warn that rigid enforcement could stifle smaller ventures.
The EU’s challenge now lies in striking a balance: enforcing standards while nurturing growth in a sector still finding its regulatory footing.
