Businesses warned over crypto providers before MiCA deadline

Confirmo has urged businesses using crypto payment services in Europe to check whether their providers hold full MiCA authorisation before the regulatory cut-off. The warning comes as many previously registered crypto firms are expected to lose the right to operate in the region.

Any crypto payment provider without a Crypto-Asset Service Provider licence must stop serving European customers once the transitional period under the EU's Markets in Crypto-Assets regime ends, the stablecoin payments company said. Firms that continue to rely on providers that fail to secure authorisation could face disruption to payments, contracts and settlement processes.

Analysis from Hogan Lovells, cited by Confirmo, suggests that about 75% of Europe's pre-MiCA crypto firms are expected to lose their registration when the deadline passes. That would cut the market from more than 3,000 providers in 2024 to 194 that are fully authorised today.

MiCA introduced a single regulatory framework for crypto-asset service providers across the European Union. During the transitional period, firms already operating under national Virtual Asset Service Provider registrations were allowed to continue while applying for full authorisation under the new regime.

That arrangement is now nearing its end, creating a sharp divide between companies that have secured approval and those that have not. For businesses using crypto payment services, the issue is not just regulatory status but the continuity of day-to-day financial operations tied to those providers.

Contracts, settlement flows, and reconciliation systems may all be affected if a provider is forced to stop operating. Businesses with cross-border payment activity or treasury processes linked to stablecoins could be particularly exposed if they have not reviewed their arrangements.

The Central Bank of Ireland authorises Confirmo as a Crypto-Asset Service Provider under MiCA and as a Payment Institution under the Payment Services Regulations 2018. This allows it to offer services across the European Economic Area from Ireland.

Regulatory divide

The approaching deadline is also likely to reshape the European crypto payments market. A large drop in the number of active providers would leave a smaller field of licensed firms competing for business from companies that want to keep using digital assets for payments and settlement.

"MiCA was the first regulation of its kind, and it has set a global standard you can already see other regulators drawing on. Regulation of this kind matters because it's what gives businesses confidence that the partners handling their money are stable, secure, and here to stay - the foundation for adoption at scale. We chose to be authorised under MiCA by the Central Bank of Ireland because it is one of Europe's most rigorous regulators, and meeting that bar is exactly what gives our clients confidence we will still be operating, and serving them, well beyond the deadline," said Derek Corcoran, Chief Executive Officer of Confirmo.

Confirmo argued that businesses should now place greater weight on the regulatory standing of their payment partners. In its view, compliance checks, once treated as a background matter, are becoming more central to procurement and risk management decisions.

Business risk

Stablecoins have become a more visible part of international payments, particularly for companies seeking alternatives to traditional correspondent banking routes. Their use in treasury, foreign exchange settlement and business payments has drawn closer scrutiny from regulators seeking to bring the sector under standardised supervision.

The end of the transitional period removes any remaining grace period for providers that have not secured a licence, Confirmo said. That means businesses that use those firms could face immediate questions about service continuity.

"From 1 July, the market will start to consolidate around the providers that took compliance seriously, and quality of regulation will become a genuine competitive advantage. Compliance teams will start asking harder questions of their payment partners, and the answers will matter more than before. For businesses working with a compliant provider, the opportunity of stablecoins is real: faster settlement across payments, FX and treasury flows, and the confidence to scale on infrastructure that regulators trust," Corcoran said.