ESMA Puts Malta’s Crypto Oversight Under the Microscope—Is MiCA at Risk?

The European Securities and Markets Authority (ESMA) has launched a review of Malta’s cryptocurrency licensing framework, casting doubt on the Financial Services Authority’s (MFSA) authorization processes for crypto asset service providers (CASPs). The probe, tied to the Markets in Crypto-Assets (MiCA) regulation now in force across the EU, highlights gaps in Malta’s compliance standards.

ESMA’s Peer Review Committee flagged shortcomings in MFSA’s handling of a specific CASP approval, noting only partial adherence to expectations. While staffing and technical capabilities were deemed sufficient, the findings underscore broader concerns about regulatory consistency under MiCA’s bloc-wide regime.

The scrutiny follows April 2025 actions by ESMA’s Board of Supervisors, building on earlier harmonization efforts with the European Banking Authority. The move signals tightening oversight as EU regulators seek uniform enforcement of crypto market rules.