News

ESMA publishes “Do’s and Don't’s” for CASPs offering unregulated services

21 July 2025

On 11 July 2025, the European Securities and Markets Authority (“ESMA”) published guidance for crypto-asset service providers (“CASPs”) offering both regulated (under the EU's Markets in Crypto-assets Regulation (“MiCA”)) and unregulated services.

Dos and Don'ts

As part of its statement, ESMA sets out a list of “Dos and Don’ts”, providing practical guidance to CASPs, and reminding CASPs of their obligation to act fairly, professionally and in accordance with the best interests of their clients and future clients. The objective is to help mitigate the risks of clients (or prospective clients) misunderstanding the regulated status of a crypto-asset product or service, and the associated protections afforded to them. A summary of ESMA’s guidance is set out below.

It is worth noting that the guidance is issued a day after ESMA publishes a summary of a peer review report which offers relevant insights in relation to the CASP authorisation process – see our article summarising this here.

Dos:

A CASP that offers both regulated and unregulated services should ensure that:

it communicates the regulatory status of the product/service at every stage of the sale process, e.g. all marketing communications should clearly indicate if a product/service is regulated or not;
information about unregulated activities is clearly distinguished from regulated activities (e.g. using separate sections on its website, and making distinctions in client documentation);
it clearly communicates which entity is offering each service and/or product (along with such entity’s legal/regulatory status), and it ensures that conflicts of interest are managed in line with MiCA requirements;
a pop-up window appears before a client is able to receive an unregulated service and/or product, which includes a check box requiring the client to read and acknowledge the unregulated status of the service/product.

Don'ts:

A CASP that offers both regulated and unregulated services should avoid:

using terminology which implies that an unregulated product or service is regulated under MiCA or other EU legislation;
only making information as to the unregulated status of a product or service visible in the Terms and Conditions;
using its regulatory status as a promotional tool and referencing its regulatory status when engaging in unregulated activities;
not clearly communicating which entity is providing the unregulated service or product (and what the associated risks are), and only including information which differentiates between service providers in the Terms and Conditions;
allowing unregulated / unauthorised entities (whether or not they are in the same group as the CASP) to offer MiCA-regulated services and/or products to its clients through the CASP’s interface.

Authored by Christina Wu and Magdalena Medarova.

Next steps

For more information, please contact a member of the team, or visit the Hogan Lovells Digital Assets and Blockchain Hub. Whether it's to find out the latest regulatory developments, or learn about new applications of the technology, we have you covered.

This article is for guidance only and is a non-exhaustive summary only of certain aspects of the points discussed and should not be relied on as legal advice in relation to a particular transaction or situation.