Coinbase and Gemini are in the final stages of obtaining operational approval across the European Union, as reported by Reuters on Monday, with both competitors set to receive Crypto Asset Service Provider (CASP) authorization in accordance with the EU-wide Crypto Asset Market Regulation (MiCA) ruleset.
According to The Block on the 16th, Coinbase and Gemini are in the final stages of obtaining operational approval across the European Union, and both competitors are expected to receive a coveted Crypto Asset Service Provider authorization in accordance with the EU-wide Crypto Asset Market Regulation ruleset.
According to Reuters, Coinbase is expected to receive its license in Luxembourg, where it plans to establish an office.
Meanwhile, Gemini, co-founded by Tyler and Cameron Winklevoss, applied for an operational license in Malta in January, according to its representative to The Block. Malta has previously granted similar approvals to OKX and Crypto.com.
MiCA, a comprehensive set of regulations and guidelines, was drafted to create a unified approach to cryptocurrency supervision across the 27-member EU trade block. These rules were fully enacted at the end of last year.
Despite creating unified standards, Reuters reported that some experts argue that the CASP licensing process still creates regulatory arbitrage opportunities. MiCA allows Crypto Asset Service Providers to "passport" across the entire region, despite the possibility of different member states following different approval processes.
Small jurisdictions with a long history of financial regulatory specialization, such as Malta and Luxembourg, are quickly becoming cryptocurrency licensing hubs, potentially creating a "race to the bottom". For example, the transnational European Securities and Markets Authority raised concerns earlier this year following the $1.5 billion Bybit hack. Maltese authorities are said to have stated that their "swift processing" stems from "years of accumulated deep understanding".
However, companies like MoonPay and Hidden Road have secured CASP authorization in the Netherlands. Simultaneously, cryptocurrency custody company BitGo received MiCA approval in Germany last month, showing that not all companies go through Malta or Luxembourg.
Gemini started operations in France after receiving an updated Virtual Asset Service Provider (VASP) license in November according to Financial Action Task Force (FATF) standards. CASP and VASP licenses differ in that CASP is specifically defined to cover a set of services within the EU's MiCA framework, while VASP focuses on global standards for anti-money laundering compliance.
The company, which is pursuing a listing, mentioned that the EU occupies a core part of its global strategy and has hired three senior executives to lead its European expansion.
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