Can MiCA provisions cover tokenized assets ?


Tokenized assets, depending on their specific characteristics and the rights they encapsulate, may or may not fall under the scope of MiCA. The key factor determining whether a tokenized asset is covered by MiCA or existing financial regulations such as the Markets in Financial Instruments Directive (MiFID) lies in the classification of the asset itself.

If a tokenized asset is considered a financial instrument, it would likely fall under the regulatory scope of MiFID II rather than MiCA. MiFID II regulates financial instruments, which include classes of securities, and the term “class” is not explicitly defined within EU financial regulations. For a crypto-asset to be recognized as a transferable security under MiFID II, it must be negotiable, transferable, and encapsulate rights attached to securities.

Furthermore, certain types of securities that primarily serve an investment function, representing participation in the performance of an underlying asset without constituting a direct investment in that asset, could be considered financial instruments under MiFID II. These include investment certificates such as Exchange Traded Commodities (ETCs), participation certificates, and tracker certificates, which do not grant the holder a direct claim to the underlying asset but rather a right to participate in its performance.

Therefore, whether tokenized assets are covered by MiCA or excluded due to being classified as financial instruments under MiFID II depends on their specific characteristics and the rights they provide to holders. Tokenized assets that are classified as financial instruments would be regulated under MiFID II, while those not fitting the definition of financial instruments could fall under the scope of MiCA, aiming to reduce regulatory uncertainty and provide a harmonized approach to crypto-assets regulation within the EU.

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