As part of our ongoing expert series on global crypto legal regimes, we analyze and evaluate different regulatory approaches for digital assets. This article covers Spain’s transition to the EU’s MiCA regulation, where the new rules represent a shift towards regulatory stability for crypto-asset service providers.
As the implementation date for MiCA approaches at the end of 2024, each EU member state must set up a process for crypto-asset service providers (CASPs) to undergo the appropriate notification or licensing requirements within the defined transition period.
MiCA brings new regulatory certainty for Spanish CASPs
Prior to the passing of MiCA, CASPs existed in a state of regulatory uncertainty in Spain due to the absence of any concrete legislation governing digital assets. In 2021, the Spanish government passed a law to amend a 2010 regulation covering anti-money laundering requirements to include entities involved in the exchange and custody of virtual assets.
According to the 2021 law, operators are required to register with the Bank of Spain and demonstrate compliance with AML requirements to be permitted to operate as exchanges or custodians. This includes being registered as a Spanish legal entity with premises in Spain and the implementation of standard AML monitoring procedures, such as KYC checks.
As of Q3, 2024, there are 122 entities registered with the Bank of Spain as virtual asset service providers. Due to the lack of regulatory clarity, the list comprises crypto-native firms rather than regulated financial institutions, with licenses registered for major providers, including Coinbase, Bitstamp, and Gemini.
MiCA transition and timeline
In March 2023, the Spanish government passed preliminary legislation for the implementation of the MiCA regulation, which included assigning regulatory responsibility for the supervision of crypto-assets to the National Securities Markets Commission (Comisión Nacional del Mercado de Valores or CNMV).
The exception is issuers of electronic money tokens and asset-backed securities (which will include stablecoin issuers), which will fall under the purview of the Bank of Spain.
In October 2023, the government further confirmed it would complete the implementation of MiCA by December 31, 2025, six months ahead of the EU implementation deadline of June 2026. Therefore, all transitional arrangements for Spanish CASPs will end by this date.
Spanish rules currently require all providers to register with the Bank of Spain as virtual asset operators regardless of their size or existing financial operations. As such, a bank launching crypto-asset services in Spain has been subject to the same registration requirements as a brand-new crypto exchange operator.
Once MiCA comes into force at the end of 2024, Article 60 of the new regulation will exempt “certain financial entities” from the requirement to obtain a CASP license from their domestic regulator. A list of entities that includes regulated credit institutions, securities depositories, investment firms, and others that are already licensed or regulated under established EU financial regulations, will be able to follow a simplified notification procedure to extend their existing operations to digital assets.
Qualifying entities are required to notify the regulator at least 40 days in advance of operating as a CASP.
Notification procedure
On July 23, 2024, the CNMV published a manual that includes the notification procedure for qualifying institutions. The notification must be submitted via a pro-forma Word document downloadable from the CNMV website, which requests a standard set of information, including existing regulatory approvals, types of crypto-asset services to be offered, and details of compliance monitoring.
The CNMV began accepting submissions in September 2024.
Licensing for new CASPs in Spain
Entities that do not qualify for the Article 60 exemption will need to make a full CASP license application via CNMV. The CNMV publication of July 23, 2024, also includes the full application form and procedure for licensing for entities wishing to set up as a new CASP in Spain under MiCA.
The application form is extensive at over 100 pages long, requiring information that includes shareholder and group structure, management body, organizational structure and mechanism for internal controls and risk management, and internal rules of conduct.
The same form must also be used to modify any existing application. Submissions are open from September 2024.
Transitional arrangements for registered CASPs
So far, the communication from the CNMV does not make any specific reference to simplified or modified licensing procedures for CASPs already registered with the Bank of Spain using the previous registration procedure. Therefore, it can only be assumed that existing CASPs must complete the same licensing application as new CASPs and will be assessed accordingly.
However, under the provisions of MiCA, existing registered CASPs should be able to continue operating during the transition period based on their existing registration until the Spanish transition period officially ends on December 31, 2025.
Even so, it’s worth noting that the portability of the MiCA license to the other 26 EU countries will only apply once the full MiCA license is obtained. Therefore, Spanish CASPs are advised to apply sooner rather than later to take full advantage of the MiCA license portability.
Future developments in the context of MiCA
The CNMV notes that ESMA is due to release technical regulatory standards and implementation standards for MiCA and that the Spanish procedures may be adjusted at a later date based on any new information forthcoming from ESMA.
Market opportunity for digital asset banking and brokerage
By bringing regulatory clarity where there has previously been uncertainty, MiCA clears the path to institutional digital asset adoption in the Spanish markets. Even in the absence of regulated offerings, the Spanish public shows substantial interest in digital assets both as an investment and as a form of payment. According to Statista, the number of Spanish crypto users is set to reach nearly 15 million in 2025, representing a user penetration rate of over 31.5%.
In early 2024, tourist hub Torrevieja in Alicante announced that it would allow stores to accept cryptocurrency payments, creating a path to adoption and a demand for banking and financial services for participating merchants.
Qualifying institutions under Article 60 can benefit from a substantially simpler notification process compared to the more admin-heavy exercise of completing a full CASP license. Therefore, there is potentially an opportunity to seize an early-mover advantage.
Launching a MiCA-compliant CASP offering with Wyden
Wyden Infinity covers the entire end-to-end trade lifecycle of digital assets across all pre-trade, trade, and post-trade use cases. It enables sell-side firms to build and maintain retail and institutional client offerings as well as internal prop-trading needs via a single platform, making Wyden Infinity the ideal choice for banks and brokers when building and scaling their fully MiCA-compliant digital asset businesses.
A key advantage of the Wyden platform is that it offers true best execution through market-wide connectivity to over 55 trading venues and a smart order routing system that carries out price comparisons and order splitting to achieve the optimal execution terms. Transparency is built into the system via real-time pre- and post-trade data, and Wyden’s standalone accounting system offers a fully auditable transaction trail.
Integration with custody partners, such as Copper, Metaco, and Fireblocks, also means Wyden maintains an auditable record of transaction flows between custody and trading with automated liquidity management solutions that ensure an uninterrupted trading experience. Core banking integrations ensure smooth reconciliation and support the assimilation of a new digital asset offering into established workflows.
Contact us today for an initial discussion about implementing a MiCA-compliant digital asset offering in your organization.
Please note that the above article does not constitute legal advice.