MiCA: end of the transitional period on 1 July 2026

The MiCA¹ transitional period ends on 1 July 2026, ushering in compliance for crypto-asset service providers across the EU. Providers must secure a MiCA licence or face wind-down and client offboarding, while authorised firms are expected to manage client migration and uphold AML/CFT standards. Supervisors will play a key role in enforcing these requirements and overseeing the transition.

On 17 April 2026, the European Securities and Markets Authority (“ESMA”) issued a statement (“Statement”) clarifying the end of the transitional periods under MiCA. The Statement sets out the supervisory expectations for this period, which will conclude across the EU on 1 July 2026.

Transitional period in Luxembourg

After 1 July 2026, any entity providing crypto-asset services within the European Union without a MiCA licence will be in breach of EU law and must cease such services. In Luxembourg, a transitional period of 18 months – starting from 30 December 2024 and ending on 1 July 2026 – has been provided for virtual asset service providers (“VASPs”) registered with the CSSF before 30 December 2024. These VASPs may continue to provide the services for which they were registered until 1 July 2026 or until they are refused authorisation under Article 63 MiCA, whichever occurs first. In any case, if authorisation is obtained prior to 1 July 2026, crypto-asset service providers (“CASPs”) may continue to provide services in accordance with their licence. 

Key requirements for wind-down plans and client migration

In line with its previous communications, ESMA reminds that CASPs which do not obtain authorisation from a national competent authority (“NCA”) by the end of the transitional period must have robust and operational wind-down plans in place, ready for implementation before the transitional period expires.

These wind-down plans must be designed in accordance with all relevant EU conduct, prudential and AML/CFT obligations, and ensure an orderly market exit without causing undue economic harm to clients. This includes arranging the offboarding of existing clients and providing them with prior notice before the plan is implemented. Furthermore, by the end of the transitional period, any unauthorised CASP should have fully executed these measures, including by arranging the transfer of crypto-assets held on their behalf to an authorised CASP or to a self-hosted wallet.

At the same time, authorised CASPs are expected to proactively manage the migration of clients and ensure their onboarding before 1 July 2026. Throughout this process, they should apply robust onboarding procedures and remain fully compliant with applicable AML/CFT requirements.

Restrictions on third-country firms

ESMA also highlights the limitations imposed on third-country entities. Except for the reverse solicitation exception, non-EU firms are prohibited from providing crypto-asset services that qualify as MiCA services to EU investors or clients. This restriction applies to both business-to-business and business-to-consumer arrangements. MiCA also prohibits CASPs from outsourcing or delegating services to entities that are not authorised CASPs. Therefore, CASPs must ensure that outsourcing and delegation arrangements do not result in circumvention of MiCA by having services provided via unauthorised third-country firms.

Enforcement 

ESMA expects NCAs to play an active role in enforcing MiCA and overseeing the transition. NCAs are expected to:

• verify that unauthorised CASPs have established, maintain and timely implement effective wind-down plans;
• assess client migration strategies to ensure that authorised CASPs take timely steps to onboard EU clients who are currently or were previously serviced by unauthorised CASPs, and to ensure that unauthorised CASPs do not continue their activities beyond the transitional period; and
• take action against the unauthorised provision of crypto-asset services after the end of the transitional period.

Consumer warning

Finally, ESMA urges consumers to verify whether their provider of crypto-asset services is duly listed as authorised in the ESMA Interim MiCA Register. If not, consumers should take action to transfer their crypto assets to an authorised CASP or a self-hosted wallet. 

In summary, the end of the MiCA transitional period marks a significant shift for the crypto-asset industry in the EU. Both service providers and consumers must act now to ensure compliance and safeguard their interests before 1 July 2026.