Post-Registration Compliance Obligations for CASPs in Luxembourg

Upon successfully registering under the Markets in Crypto-Assets (MiCA) regulation in Luxembourg, Cryptocurrency Asset Service Providers (CASPs) are required to adhere to a comprehensive set of obligations designed to ensure the integrity, transparency, and security of their operations. These obligations are crucial for maintaining the authorisation to operate within the European Union’s regulatory framework for crypto-assets.

Key obligations for CASPs under MiCA

Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) Compliance (Article 64 § 1 f of MiCA): CASPs must establish, implement, and maintain robust AML/CFT policies, procedures, and systems to deter their services from being exploited for money laundering or terrorist financing activities. Failure to comply may result in the withdrawal of authorisation by competent authorities.
Customer Due Diligence (CDD) Requirements (Article 68 of MiCA): Comprehensive CDD processes must be conducted for all customers, including both natural persons and legal entities, to prevent engagements with parties under sanctions or legal restrictions.
Operational Transparency (Article 66 of MiCA): CASPs are mandated to operate transparently, providing clear, comprehensive information about their services, associated fees, and terms and conditions to their customers.
Capital Adequacy (Article 67 of MiCA): Adequate financial resources are required to cover the risks associated with CASP activities, in line with capital adequacy requirements determined by the CSSF.
Risk Management: Effective risk management policies and procedures must be in place to identify, assess, and manage various risks, including market, credit, and operational risks.
Legal and Regulatory Compliance (Article 68 § 4 of MiCA): CASPs must ensure full compliance with all relevant laws and regulations, including Luxembourg’s AML/CFT laws and any other applicable regulatory frameworks.
Regulatory Reporting (Articles 68-69 of MiCA): Regular submissions of reports to the CSSF are required, detailing financial conditions, risk exposure, and adherence to AML/CFT standards.
Record Keeping (Article 68 § 9 of MiCA): Comprehensive and accurate records of all transactions, customer information, and other relevant data must be maintained, with a preservation period of at least five years.
Independent Auditing (Article 67§ 3 of MiCA): CASPs are subject to periodic audits by independent auditors to verify compliance with regulatory requirements.
Complaints Handling (Article 62§ 3 l of MiCA): A structured mechanism for addressing customer complaints must be established, ensuring timely and effective responses.

Staying ahead of regulatory changes

CASPs must remain vigilant and proactive in updating their policies and practices in response to evolving regulatory requirements and industry best practices. This ongoing commitment to compliance not only safeguards the CASP’s operational legitimacy but also enhances its reputation and trustworthiness in the dynamic crypto-asset market.

It is crucial for CASPs to continuously monitor regulatory developments and adapt their operations accordingly to maintain compliance and uphold the highest standards of operation within Luxembourg’s crypto-asset regulatory environment.This is placeholder text. To change this content, double-click on the element and click Change Content. Want to view and manage all your collections? Click on the Content Manager button in the Add panel on the left. Here, you can make changes to your content, add new fields, create dynamic pages and more. You can create as many collections as you need.

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