CySEC announces deadline for CASP applications
CySEC announces deadline for CASP applications
The Cyprus Securities and Exchange Commission (CySEC) announced that starting October 30, it will no longer accept new applications for registration as Crypto Asset Service Providers (CASPs).
The decision comes as the regulatory body prepares to align with the European Union’s forthcoming Markets in Crypto-Assets (MiCA) framework, which will impose stricter rules across the crypto sector starting in 2025.
The decision by CySEC aims to streamline the transition process ahead of the EU’s regulatory overhaul. The suspension of new CASP applications signals the regulator’s intent to prioritize oversight rather than the registration of new companies. Existing CASPs in Cyprus will need to ensure full compliance with the upcoming MiCA rules, which set higher standards for consumer protection, transparency, and market integrity.
This shift reflects broader regulatory efforts across the European Union to bring clarity and consistency to cryptocurrency markets, which have faced criticism for their lack of oversight and potential for financial crime. CySEC’s decision also follows increased scrutiny of crypto operations in Cyprus, where the financial regulator has ramped up supervision to ensure companies meet compliance standards.
In a statement, CySEC emphasized that the freeze on new applications is a temporary measure intended to give regulators and businesses time to prepare for the new legal framework. Companies operating in the crypto space must comply with MiCA by October 2025, while an October 30, 2024, deadline has been set for those currently in the application process to complete their submissions.
While the move aims to enhance regulatory certainty, it also presents challenges for startups and smaller firms seeking entry into the market. New applicants will need to wait until the MiCA regulations take full effect to submit applications under the revised framework. This could slow the expansion of the crypto industry in Cyprus, which has attracted numerous CASPs due to its favorable regulatory environment.
As CySEC aligns with MiCA’s stricter standards, crypto service providers will face more rigorous reporting requirements, operational controls, and consumer protection obligations. Market observers are closely monitoring how these changes will impact Cyprus’ position as a hub for digital asset businesses.
The decision reflects a growing trend among regulators to tighten oversight of the crypto industry, and it signals the importance of harmonized rules across the European Union. As the October 30 deadline approaches, companies are working to complete their applications or adjust their operations in anticipation of the new regulatory landscape.
The next few months will be critical for both regulators and businesses as they navigate the complexities of implementing MiCA. The outcome will shape the future of Cyprus' crypto market and could influence the broader adoption of digital assets in the European financial sector.
Read also: Kraken issues its own Wrapped Bitcoin token, kBTC
