This series of articles will take you step by step through the key concepts that are relevant for crypto asset service providers in the context of MiCAR. The following services, which are regulated under MiCAR, play a central role in the crypto industry, whether in trading, custody or advisory services.
The series begins with a detailed look at the custody and administration of crypto assets and continues with topics such as the operation of trading platforms as well as advisory services on and portfolio management of crypto assets. The series is rounded off by an examination of the legal requirements and the practical impact of these services on the crypto market.
Stay tuned as we decode the essential MiCAR terminology and give you a solid insight into the regulatory foundations and the role of each crypto service.
Glossary entry – provision of custody and administration of crypto assets on behalf of clients
Crypto custody is a crucial service in the DLT and crypto asset ecosystem that relates to the secure custody and administration of crypto assets for clients. This includes both the safekeeping of private keys and administrative tasks such as processing transactions.
In a highly digital and decentralized market such as cryptocurrencies, secure custody plays a key role in gaining investors’ trust and ensuring protection against losses from cyberattacks.
Glossary entry – provision of transfer services for crypto assets on behalf of clients
This service relates to the execution of on-chain transactions with crypto assets on behalf of clients. Providers that offer such transfer services act as intermediaries facilitating the transfer of crypto assets between different parties. This is particularly relevant for institutional trading as well as for private clients who rely on simple and secure transfer processing. The transparency and security of these transfers are regulated in detail by MiCAR.
Glossary entry – placement of crypto assets
The placement business is the process by which providers place issuances of crypto assets on the market on behalf of third parties. This enables companies to sell cryptocurrencies or tokenized assets to a wide audience. MiCAR regulates this service to ensure that the placement is fair and transparent and that investors are adequately informed.
Glossary entry – advisory services on and portfolio management of crypto assets
Advisory services relating to cryptocurrencies and the administration of crypto portfolios offer investors professional support in making investment decisions. MiCAR ensures that service providers offering advisory services and portfolio management meet strict requirements in terms of qualifications and safeguarding the interests of their clients.
Glossary entry – transmission and execution of crypto asset orders on behalf of clients and exchange of crypto assets for fiat or other crypto assets
Crypto asset service providers that enable the trading and exchange of crypto assets offer their clients an important interface between the digital and the real world. This includes the acceptance, transmission and execution of buy and sell orders as well as the exchange of crypto assets for fiat or e-money. These services require a high level of transparency and efficiency, as they are often at the heart of day-to-day business.
Glossary entry – operation of a trading platform for crypto assets
The operation of trading platforms for crypto assets is another key component of the crypto ecosystem. These platforms provide the framework in which buyers and sellers come together to trade cryptocurrencies. MiCAR sets out the requirements for the operation of such platforms to protect market integrity and prevent market manipulation.
