A consultation paper jointly published by the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) on October 20th addresses the assessment of suitability of directors and shareholders at issuers of asset-referenced tokens (ART) and cryptoasset service providers (CASP). There are two drafts.
The draft joint guidance provides a common approach for regulators to assess the suitability of shareholders or members who hold, directly or indirectly, qualifying shares in ART and CASP issuers. This includes ART and CASP issuance authorization and conducting prudent assessments of potential acquisitions.
However, the proposed joint guidance for assessing the suitability of board members in ART and CASP issuer firms provides standard criteria such as knowledge, expertise, integrity and the ability to devote sufficient time to fulfilling their responsibilities.
To maintain the integrity of the cryptocurrency market and associated services and build trust, it is important to determine the eligibility of board members of ART and CASP issuers and individuals seeking to own or acquire qualifying shares.
The guidelines set out in these drafts are intended to provide clarity and standardization in assessing the suitability of the board of directors, shareholders and members with qualified shares. This aims to minimize rule application differences and arbitrage potential. The consultation process will remain open until 22 January 2024.
In anticipation of upcoming regulations, the European Union's banking regulator has encouraged stablecoin issuers to voluntarily comply with certain "guidelines" on risk management and consumer protection. The EBA announced its first measures, which were put out for public comment on July 12, and aimed to clarify the requirements for the Crypto-Assets Market regulation (MiCA), which is scheduled to come into force on June 30, 2024.
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