Melker Bengtsson
TL;DR
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Belgium's FSMA added six platforms to its list of fraudulent crypto-asset service providers, the first action since MiCA's deadline
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Being added to the list has no consequences: no fines, no cease and desist, no proceedings
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The warning list has been in effect since 2014, and adding companies in bulk is what FSMA has always done
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MiCA has been a huge change for crypto in the EU, but actual enforcement has not started yet
On July 1st, the grandfathering period of the European Union's crypto framework MiCA ended. Platforms that haven’t got a license in a member state must stop taking new EU customers and may offer only the services clients need to withdraw or move their assets. The fines can be heavy and, in some countries, even lead to jail time.
What the FSMA Actually Did
In Belgium, the first few cases of enforcement referring to the framework have come out. In many publications it’s been touted as a significant change has happened - but the numbers say otherwise.
Six platforms were added to the official list of fraudulent crypto-asset service providers by the FSMA, the Belgian financial markets regulator. Aurum Foundation, Bank Bit, Bithf Pro, Dxago, Global Dynamic Trade, ZeriaFunding. None of these are household names, likely only recognisable to a very small number of people who have had the misfortune of being directly advertised to.
Being added to the list of fraudulent exchanges has no consequences, other than being on the list. It’s a consumer warning. No fines have been given, no cease and desist, no proceedings.
While, yes, this is the first time action has been taken against crypto exchanges since MiCA came into full effect, and yes, they’ve added six exchanges at the same time, practically nothing has changed.
The list warning consumers of fraudulent exchanges has been in effect since 2014, before MiCA was even considered. And adding companies in bulk is what they’ve always done. In 2018, they added 14 trading platforms in one update, in mid-2023 they added 38 and in late 2023 they added another 50+ - all in one go.
The only thing that’s changed? Pre-MiCA the warning said these platforms were unsupervised. Now, they say that they’re unauthorized based on MiCA. Other than that, it’s the same regulator, the same list and the same targets.
What MiCA Has Actually Changed
Saying that, a lot has changed. Crypto platforms now register once in the EU and then have access to the entire market. Before that, they had to register in each country individually with varying difficulty. Some countries had no crypto regime at all. The MiCA framework has made authorization to serve EU residents much tougher.
Before MiCA, 1200+ registered platforms existed in EU countries. After it, only 280 are MiCA authorized. Granted, a few of those were duplicates with firms registering in multiple countries, but for example in Estonia, the number of recognised platforms went from 641 to 40. Additionally, the consequences of breaking the rules went up, up to €5 million in fines and, in France, 2 years in jail. Even Binance has failed to get authorized.
So, MiCA has been a huge change for crypto in the EU, but the Belgian authorities adding platforms to a consumer warning list is not an effect of that. Enforcement of the framework has not started yet, and we’ll have to wait to see what actual enforcement will look like when we have our first actual case.
