The European Supervisory Authority (ESA) today issued a strong warning to crypto investors. In so doing, they highlight the inherent volatility of digital assets and the limited legal protection they offer, depending on the type of cryptoassets and providers involved.
The measures are aimed at warning investors about the rapid movements of an expanding market that, although better regulated, still has weaknesses.
Since December 2024, the MiCA (Markets in Cryptoassets) Regulation, aimed at establishing a supervisory regime for issuers and suppliers, has been comprehensively implemented in the European Union. CriptoNoticias reported on this at the time.
This legal framework for cryptocurrencies was launched as efficient and necessary for the European financial system. However, the authorities themselves have pointed out and warned that “not all crypto assets are the same.” Consumer protection could be significantly compromised Depending on the type of asset or service, investors may be exposed to a lack of comprehensive information or uniform complaint procedures.
This alert is accompanied by a detailed fact sheet explaining the impact of MiCA. In this sense, the AES bloc, consisting of the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA), Urging consumers to take urgent action.
These measures include checking whether the service provider or issuer you use is authorized in the EU, knowing the product before investing, and ensuring your digital wallet is protected.
“Consumers are encouraged to learn about products and services and assess the risks before investing,” the statement said, highlighting “the active promotion of digital assets on social networks by finfluencers.”
A detailed analysis shows that the legal framework's “weaknesses” lie in several pillars. Legal protection depends on the specific type of crypto asset Services and services create an incomplete regulatory shield.
Additionally, some companies that were already providing crypto-asset services in accordance with national law before December 30, 2024 may continue to operate until July 1, 2026, or until authorization or refusal under MiCA, whichever is earlier. “This means that until the transition period ends and the provider is authorized by MiCA, consumers will not benefit from MiCA protection when using the services of such providers,” the agency claims.
User exposures are multiple and rapid. Risk of losing your entire investment Due to extreme volatility. Also, as many in Spain in particular have already experienced, there is no compensation system in the event of supplier insolvency, leaving them highly vulnerable to fraud, fraud and cyber threats.
The MiCA regulation is being implemented in stages from July 2024. In December of the same year, a central register of authorized suppliers was created, considering this an important step for investor safety. “Only companies authorized and registered with ESMA may offer crypto asset services in the EU under MiCA,” the authority said.
In an international context, this warning highlights the global urgency to control exponentially advancing technology while regulators struggle to establish a solid footing.
