Zug

Following the roundtables in London, Berlin, Vienna, and Brussels, the sixth MiCAR Roundtable took place on the 2nd of October 2024 in Zug, Switzerland, at CV Labs. The event was supported by Crystal Intelligence, Token Recovery, and CV Labs, with collaboration from thinkBLOCKtank.

The event featured a keynote by Joachim Schwerin, Principal Economist at the European Commission, and included expert contributions on reverse solicitation in a group context, cross-border custody infrastructure for EU-based clients, and managing the combination of reverse solicitation and offering regulations for crypto-asset issuers

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Navigating the Reverse Solicitation Labyrinth in a Group Context

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This session explored the complexities surrounding the use of reverse solicitation by third-country firms with a MiCAR-licensed subsidiary in the EU. Key concerns included how brand identities might lead to indirect solicitation risks, and the challenge of proving that services were client-initiated without crossing solicitation lines.

Clarify the Scope of Reverse Solicitation: Regulators should define how reverse solicitation applies to third-country firms with EU subsidiaries under MiCAR, particularly regarding marketing activities.
Maintain Brand Consistency: Allow third-country firms to keep their global brand identity while complying with MiCAR, provided there is clear separation of services.
Set Documentation Standards: Define documentation requirements to prove customer-initiated interactions during regulatory reviews.
Limit Geo-Blocking: Focus on compliance solutions rather than restricting service access via geo-blocking.

Handling the Combination of Reverse Solicitation with Offering Regulations

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This session discussed the dual compliance challenge faced by third-country crypto projects that provide both crypto-asset services and issue crypto-assets. MiCAR’s different requirements for these activities raise potential conflicts, especially around reverse solicitation.

Ensure Regulatory Separation: Keep a clear distinction between crypto-asset issuance and service provision through marketing strategies and separate websites.
Avoid Overlap in Promotion: Separate promotions for crypto-asset issuance and services to avoid undermining reverse solicitation rules.
Assess Token-Service Connection: Consider the relationship between tokens and services to avoid breaching MiCAR’s requirements.
Use Separate Channels for Services: Promote self-issued crypto-assets and services through distinct channels.

Third-Country Custody Infrastructure for EU Entities

The topic discussed whether third-country custody infrastructure can be leveraged for EU branches. MiCAR’s outsourcing rules present challenges for using custody services based in non-EU jurisdictions like Switzerland.

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Pursue Bilateral Treaties: Third countries should enter bilateral agreements with EU Member States to allow supervisory authorities access to information.
Clarify Custody Definition: Narrow the definition of 'providing custody' to focus on control over private keys.
Take a Risk-Based Approach: Interpret MiCAR provisions from a risk perspective to allow third-country providers to offer infrastructure without direct access to crypto-assets.