Summary
- Europe's MiCA regime advanced crypto regulatory efforts beyond licensing toward whether smaller crypto firms can sustain the cost of long-term regulatory compliance.
- Lawyers say the U.K.'s proposed framework could prove just as demanding as MiCA by integrating crypto firms into existing financial services regulation rather than creating a standalone regime.
- Banks, already equipped with compliance infrastructure, may emerge as major beneficiaries through acquisitions, partnerships and institutional crypto offerings.
The race to secure Markets in Crypto Assets (MiCA) licenses may be over, but Europe's landmark crypto rulebook is already entering a new phase, one that could reshape the industry's ownership structure.
Firms now facing the ongoing cost of operating under comprehensive regulation, suggesting the next chapter won't be defined by licensing victories, but by mergers, acquisitions and collaborations between crypto-native firms and established financial institutions.
That trend could accelerate further in the U.K., where the Financial Conduct Authority's (FCA) proposed crypto framework is expected to impose standards comparable to MiCA by weaving crypto activities into Britain's existing financial services regime.
“The FCA is trying to help competition, and it really is trying to help newcomers,” said Steven Lightstone, a partner at Morgan Lewis' London office and co-leader of the firm's global fintech industry team. But, he added, “it does have very high standards, particularly where consumers are involved.”
Unlike the EU's standalone MiCA framework, the U.K.'s proposals would integrate crypto firms into the same regulatory architecture that governs traditional investment firms. That means businesses would face familiar prudential, operational and client asset requirements rather than a bespoke crypto regime.