Non-MiCA-Compliant Stablecoins: ESMA’s Service Restrictions and CASP Remediation
On 8 October 2026 the European Securities and Markets Authority (ESMA) published an opinion stating that CASPs authorised under MiCA should stop providing services related to non-MiCA-compliant stablecoins to clients in the EU. National authorities are expected to require remaining client exposure to be remediated as soon as possible, and no later than three months after publication.
For most CASPs, the time goes into finding every route through which clients can still reach these tokens. A trading pair removed from the website may still be available through an API, a quick conversion feature or an automated portfolio.
What the opinion requires
The opinion is addressed to national competent authorities and aims for consistent supervision. It does not amend MiCA. ESMA bases its position on the duty in Article 66(1) to act honestly, fairly and professionally in the best interests of clients, and states that warnings, disclosures or client acknowledgements cannot make up for missing issuer safeguards.
The scope covers every MiCA crypto asset service, provided alone or in combination: custody and administration, operating a trading platform, exchange for funds or other crypto assets, execution, placing, reception and transmission of orders, advice, portfolio management and transfers.
Three months from 8 October 2026 is 8 January 2027. That is the latest date for clearing legacy exposure, not a period in which normal business may continue. National authorities may also publish their own implementation steps.
Supervisors may permit strictly limited services so that existing holdings can be wound down: sale, conversion, withdrawal, transfer or safekeeping. These must be time limited, clearly explained to clients and closely supervised. They cannot support new purchases, promotion or ordinary trading.
Which tokens are affected
Under MiCA Article 3, an Emoney token (EMT) is a crypto asset presented as maintaining a stable value against one official currency. An asset referenced token (ART) falls outside the EMT category and claims stability by reference to other values, rights or combinations, which may include one or more official currencies. Under the opinion, a token is non compliant where the conditions in Title III or IV for a lawful public offer or admission to trading in the EU are not met, taking account of applicable exemptions and transitional arrangements.
The two categories require different checks. Article 48 generally requires an EMT issuer to hold authorisation as a credit institution or electronic money institution and to notify and publish a white paper, subject to applicable exemptions. Under Article 16, an ART issuer generally needs to be established in the EU and authorised by its home authority, or be a credit institution meeting Article 17. Exemptions carry specific conditions; a small issue or an offer to qualified investors does not qualify automatically. An “approved white paper” checklist alone will miss these distinctions.
For each token, keep a dated record of the legal classification, the issuer and its authorisation, the token name, ticker, network and contract address, the current white paper, and who approved the decision. Start with ESMA’s interim MiCA register, which lists ART issuers, EMT issuers and CASPs separately. It is republished weekly and can trail national registers, so confirm entries against the national authority’s records and the issuance documents. A wrapped or bridged version of a known stablecoin needs its own review, because the same ticker does not mean the same issuer obligations apply.
Testing the controls
ESMA expects technical, contractual and organisational controls that stop clients acquiring or increasing exposure. The table below is our suggested test plan, not an ESMA template.
| Area | What to test | Evidence to keep |
|---|---|---|
| Trading and conversion | Web, mobile, quick conversion, recurring purchases | Results from each channel |
| Order handling | API, pending orders, routing, fallback liquidity | Rejection logs and configuration changes |
| Advice and portfolios | Recommendations, model portfolios, rebalancing | Revised asset lists and sample instructions |
| Custody and transfers | Deposits, internal transfers, withdrawals | Map of permitted exit functions and blocked entry points |
| Group and partner channels | Shared front ends, embedded wallets, partner APIs | Proof that restrictions reach EU clients |
Test accounts that already hold a balance, not only new clients, because ESMA’s concern extends to increased exposure. Record failed and successful attempts with the account type, request, timestamp and result. Decide which clients are in scope using the contracting entity and onboarding records as well as access data. An IP address alone is weak evidence.
Planning the client exit
Group holdings by the obstacle clients will face. Some balances can be withdrawn at once. Others sit below the minimum withdrawal amount, are on a network the firm no longer supports, or are tied up in a dispute. Each group needs its own route, cost allocation and owner.
Before selling or converting anything for a client, confirm the contractual basis, the client’s instruction, the execution venue and the pricing. The opinion does not by itself authorise a firm to convert client assets compulsorily.
A client notice should say which functions change and when, what the client can still do, what it will cost, what happens if the client does nothing, and where to get help. A notice that only says “delisted for regulatory reasons” passes those questions to the complaints team.
Keep a separate log for difficult cases, with an owner, next action, escalation date and any supervisory correspondence.
Governance and closure
Run the inventory, exposure analysis, control changes and client exit in parallel, under a plan approved by senior management or the board. Set internal dates against the supervisory deadline, and fix problems already identified without waiting for the inventory to finish.
Define completion through verifiable results. Confirm that affected clients cannot make new purchases or increase existing holdings through the website, app or API, and retain the test evidence. At closure, verify that system changes have been deployed and tested, and reconcile client ledgers with wallet records and custodian balances. Document any discrepancies and remaining holdings, together with the next steps.
Implications for Cyprus CASP applicants
Article 62 requires an application to describe the programme of operations, governance, internal controls, ICT systems, segregation of client assets and the arrangements for each service applied for. An applicant that says it will support only reviewed tokens should be able to show who approves a token, what triggers a new review and how a suspension reaches the systems and suppliers that must act on it.
Check outsourcing contracts before launch. Can the wallet, custody or trading system provider block a single token quickly, supply the records needed for reconciliation and support an exit route?
Once authorised under MiCA, a CASP falls within the scope of DORA (ESMA Q&A 2364). The opinion adds no DORA rules, but changing wallet or trading workflows is a good time to review change management, recovery plans and supplier dependencies.
FinPro’s Cyprus financial licensing service covers the application route and permission scope in more detail.
Buying a MiCA authorised CASP
A licence tells a buyer little about the remediation work that comes with the business. In due diligence, ask for the authorisation file and supervisory correspondence, current and historical token lists with restriction dates, reconciliations between client records, wallets and custodians, and the supplier agreements that govern any exit. Test the website, app and API yourself rather than relying on the seller’s description, and review complaints and refunds for costs not yet reflected in the price.
Findings can be addressed through work before completion, warranties, specific indemnities or a price retention, drafted by transaction counsel.
Frequently asked questions
Does ESMA ban every stablecoin?
No. The opinion concerns ARTs and EMTs that do not meet the relevant MiCA conditions, and the CASP services connected with them.
Is it unlawful for a client to hold one?
The opinion deals with CASP services and supervisory practice. It does not say that holding these tokens is unlawful for individuals.
Can a CASP keep custody during the exit?
Only within the restricted exit arrangements a supervisor accepts, and only for a set period. A custody permission does not turn legacy holdings into an ordinary custody business.
Does a Cyprus CASP licence approve each listed token?
No. CASP authorisation and the issuer requirements for ARTs and EMTs are separate questions, and an internal listing decision is not regulatory approval.
How FinPro can help
FinPro Consulting supports CASP applicants, operators and buyers with permission reviews, operating documents, remediation projects and transaction due diligence, working alongside local legal and regulatory advisers. Before a first call, prepare a list of services, a full token inventory and a diagram of how client assets and orders move through the business, together with any existing balances and target launch or completion dates. Contact us through our financial licensing advisory services page.
Information checked as at 15 October 2026. This article is general business information, not legal advice on any specific case. FinPro does not certify token compliance or guarantee authorisation or supervisory acceptance.
