The first major review of Europe’s Markets in Crypto Assets framework is beginning to expose the limits of the original perimeter.
On September 30, the European Securities and Markets Authority published recommendations for the European Commission’s review of MiCA. ESMA called for changes covering staking, lending and borrowing, DeFi access, cryptoasset marketing, cost transparency and token classification.
It also proposed clearer criteria for determining when an activity is genuinely decentralised and suggested a new regulated cryptoasset service for firms that provide users with access to DeFi protocols.
The European Banking Authority had published its own review priorities six days earlier. Those recommendations include stronger treatment of risks arising from multi issuer stablecoin structures, clarification of MiCA’s scope and regulation of cryptoasset lending, including activities linked to DeFi.
These are recommendations to the European Commission. They are not amendments to MiCA that have already taken effect.
That distinction is important because the review is showing where regulatory classification becomes harder as products become less neatly separated.
A service can combine custody, lending, staking, token issuance and protocol access inside a single customer interface. A token may also carry characteristics that do not fit cleanly into one existing category.
The question for institutions is therefore moving beyond whether MiCA exists. It is whether activities that developed around the edges of the original framework can be brought into a consistent supervisory model.
ESMA’s comments on tokenized securities point to another boundary.
MiCA primarily concerns cryptoassets outside the existing financial instrument framework. Tokenized securities remain connected to a separate body of capital markets law. ESMA is now also calling for a broader framework capable of supporting tokenized securities and onchain settlement across Europe.
That creates two related but distinct regulatory tasks.
Europe needs to clarify emerging crypto services under MiCA while also deciding how existing securities regulation should operate when the underlying market infrastructure becomes digital.
What to watch
The next stage is the European Commission’s response and whether these recommendations turn into legislative proposals.
The most consequential areas are likely to be activities currently sitting between classifications, particularly lending, staking, DeFi access and stablecoin structures spanning more than one issuer or jurisdiction.
Until legislation changes, firms should not treat the recommendations as new legal obligations. They are better read as an early indication of where the European regulatory perimeter may move next.