European Regulator to Introduce Competency Assessment in Crypto-Asset Sector
The European Securities and Markets Authority (ESMA) published a draft guidance document outlining the criteria for assessing the knowledge and competencies of advisors and specialists in the field of cryptocurrency assets.
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ESMA introduced a consultation paper on knowledge and competency assessment criteria for professionals providing advisory services or information on crypto-assets. The initiative aims to enhance investor protection. The regulator invites market participants to discuss the proposal, with consultations open until April 22, 2025.
ESMA sets minimum knowledge and competency standards for crypto professionals, namely:
- understanding the characteristics of digital assets and the risks associated with their use;
- familiarity with distributed ledger technology (DLT) and asset valuation mechanisms;
- knowledge of MiCA regulations, including investor protection requirements;
- ability to analyze market trends and assess macroeconomic factors’ impact on crypto-assets.
ESMA places special emphasis on continuous learning. The proposal suggests a minimum annual professional development requirement of at least ten hours for information providers and at least 20 hours for advisors.
The regulator’s requirements include:
- cryptocurrency companies providing advisory services;
- specialists providing information or recommendations on crypto-asset usage;
- national regulators responsible for market oversight.
The regulator highlights that the requirements will vary based on job roles, e.g., with higher standards applied to advisors than to professionals providing basic information.
All stakeholders, including crypto firms, investors, financial institutions, and government regulators, are invited to participate in the consultation. The finalized recommendations will be published in Q3 2025.
This consultation document was developed within the framework of the MiCA regulation, which came into effect on December 30, 2024.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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