The European Securities and Markets Authority (ESMA) has expressed concerns about the practices of cryptocurrency platforms that fail to clearly distinguish between regulated and unregulated products.
Issues with Regulatory Designation
ESMA reports that blending regulated and unregulated services may lead investors to mistakenly assume that all services are covered under the protections of the Markets in Crypto-Assets (MiCA) framework.
ESMA’s Recommendations for Crypto Firms
The regulator advises crypto asset service providers (CASPs) to avoid using regulatory licenses to promote unrelated or non-compliant services. ESMA insists that regulatory boundaries must be clearly communicated.
Potential Consequences for Investors
The regulator emphasized that highlighting MiCA authorization as a marketing tool risks misleading customers. This creates unnecessary risks for consumers.
Thus, the European Union continues to monitor the situation in the cryptocurrency market and requires platforms to provide more transparency regarding their regulated and unregulated services.
