Spain’s financial regulator has warned that crypto firms which fail to secure a licence under the European Union’s new MiCA rules will not be given extra time, reinforcing that the July 1 deadline will be strictly enforced.
Spain’s securities market watchdog CNMV Chairman Carlos San Basilio said on Friday that there “would be no exceptions or extensions” for those companies that had not received authorization under the Markets in Crypto-Assets (MiCA).
Rather than granting any grace period to these companies, San Basilio said the regulator was helping them close down their operations smoothly.
Singing from the same hymn sheet, crypto exchange Binance has also advised its users in many European Union countries to withdraw funds and wrap up business.
MiCA enforcement deadline draws near across the EU
The announcement is being made a few days before MiCA becomes applicable throughout the entire European Union.
The licensing system requires crypto exchanges and service providers to acquire a license from one of the regulators in one EU member state to provide services all across the EU. Failure to get an authorization can result in companies losing access to millions of European customers.
The comments put more strain on Binance, which still attempts to get the authorization.
Earlier this week, Binance announced that it was abandoning the process of acquiring the MiCA license in Greece because it would apply for licensing in one of the other EU countries instead. It stated that it still plans to keep on with the European market and to get a license “in the coming months” despite the fact that some of its customers will be impacted.
As reported by the Financial Times, customers of Binance operating in Poland, Italy, Spain, and France have already sent emails on how to withdraw their assets due to service changes.
The problem with licensing has also resulted in a heated discussion between industry heavyweights.
CZ says EU users risk losing access to global crypto liquidity
CZ, the founder of Binance, blasted the situation on X, saying “sad to see the EU cutting their users off from the best liquidity in the world.” “Access to deep liquidity is one of the strongest forms of consumer protection in crypto markets,” he added.
Star Xu, founder and CEO of OKX, was quick to dispute his comments.
Xu accused Binance of pursuing what he called a regulatory arbitrage strategy, claiming the exchange continued to operate in parts of Europe while MiCA rules were being implemented rather than obtaining the necessary licence first. The episode also shows why regulations must be applied equally to all market participants, he added.
Not everybody will be burdened by MiCA. The regulation is viewed as a step toward a more unified European crypto market for exchanges that have adopted the new framework.
“MiCA provides the legal certainty the industry has been waiting for,” said Beata Sivak, Kraken’s head of policy and government relations for Europe, the Middle East and Africa.
“One rulebook and one passport across thirty countries is what European crypto has been missing,” she said, adding that the framework helps customers distinguish between regulated and unregulated providers.
With the July 1 deadline now just around the corner, Spain’s message leaves little doubt that regulators intend to enforce MiCA as written. For exchanges still without a licence, the window to continue operating in Europe is rapidly closing.
