European Banking Authority and ESMA Release Guidelines for Crypto Entity Suitability

The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) have jointly published a consultation paper on October 20, which includes two drafts. These drafts focus on evaluating the suitability of management body members, as well as shareholders or members holding qualifying stakes in issuers of asset-referenced tokens (ARTs) and crypto asset service providers (CASPs).

The proposed joint guidelines aim to establish a consistent regulatory framework for assessing the qualifications of stakeholders, whether direct or indirect, with qualifying stakes in ART and CASP issuers. This approach is intended to facilitate the authorization process for ART and CASP issuance, along with prudential assessments for prospective acquisitions.