With the European MiCA Regulation, the market for crypto-assets is for the first time uniformly regulated across the EU. Anyone wishing to offer crypto services – custody, trading platform, exchange, execution – will in future need authorisation as a Crypto-Asset Service Provider (CASP). With the supervisory authority CySEC, Cyprus is an established location for this authorisation with an EU passport.
What MiCA governs
The Markets in Crypto-Assets Regulation (MiCA) creates a uniform legal framework for crypto-assets in the EU. It regulates the issuance of certain tokens as well as the provision of crypto services and replaces the previously fragmented national rules. For providers this means legal certainty – and at the same time genuine regulatory duties.
The Crypto-Asset Service Provider
CASPs are companies providing crypto services: the custody and administration of crypto-assets, the operation of a trading platform, the exchange of crypto-assets for money or other crypto-assets, the execution of orders, placing, advice or portfolio management. These activities require authorisation by the competent national authority.
CySEC and the EU passport
In Cyprus the Cyprus Securities and Exchange Commission (CySEC) is the competent authority. A CASP authorisation granted there allows the services to be offered throughout the single market via the EU passport. Instead of a multitude of national approvals, one authorisation suffices – a considerable advantage for providers operating Europe-wide.
Requirements and substance
Authorisation requires a serious set-up: adequate capital, reliable and professionally suitable management, arrangements for custody and security, compliance and risk functions and clear processes for investor and anti-money-laundering protection. As with any regulated activity in Cyprus, real on-site substance is a basic requirement.
The tax integration
The CASP's profits are subject to 15% corporate tax. The advantages of the Cyprus system – participation exemption, no withholding tax on outbound dividends, Non-Dom at shareholder level – are available. The regulatory and tax structure must be aligned with each other.
The role of CMC: Non-Dom Status
The CMC team supports the establishment of the CASP structure, the build-up of the required substance and the tax integration and coordinates with your German advisor. The regulatory authorisation and reserved legal acts run through the competent bodies and the partner law firm A. Panayiotou LLC.
The covered services in detail
The range of crypto services requiring authorisation is broad. Covered are, among others, the custody and administration of crypto-assets for clients, the operation of a trading platform, the exchange of crypto-assets for money or for other crypto-assets, the execution of orders, placing, the reception and transmission of orders and advice and portfolio management. Anyone providing one of these activities commercially needs authorisation as a Crypto-Asset Service Provider.
Requirements for authorisation
Authorisation requires a serious set-up: adequate capital, reliable and professionally suitable management, secure custody and IT arrangements, effective compliance and risk functions and robust processes for investor and anti-money-laundering protection. For the custody of client assets, special segregation and safeguarding duties apply. These requirements presuppose real on-site substance.
The EU passport for crypto service providers
The essential advantage of MiCA authorisation is uniformity: an authorisation granted in one member state allows, via the EU passport, the provision of the services throughout the single market. Instead of a multitude of national approvals, one authorisation suffices – a considerable efficiency gain for providers operating Europe-wide.
The 8% flat rate since the 2026 reform
With the 2026 tax reform, Cyprus applies a flat rate of 8% to gains from the disposal of crypto-assets – such as from sale, exchange or use as a means of payment. Losses from crypto disposals can only be offset against gains of the same year; no carry-forward is provided. This flat rate creates, for the first time, clear rules for taxing crypto gains and must be considered in any planning.
Common Questions about MiCA and the CASP Licence in Cyprus
What is MiCA? The EU Markets in Crypto-Assets Regulation – a uniform legal framework for crypto-assets replacing the previously fragmented national rules.
Who needs CASP authorisation? Providers of crypto services such as custody, trading platform, exchange, execution, placing, advice or portfolio management.
What does the Cyprus authorisation bring? A CASP authorisation granted by CySEC allows the services to be offered throughout the single market via the EU passport.
Do I need substance? Yes. Required are, among others, adequate capital, suitable management, custody, compliance and risk functions and real presence.
The MiCA and CASP Licence for Crypto in Cyprus: The Authorisation Earned Under MiCA, Not Assumed a Light Regime
The crypto-asset service provider (CASP) authorisation under MiCA is earned through the regulation's requirements—capital, governance, custody, conduct—not assumed to be a light or formality regime for crypto — the system briefing first: The CASP is regulated under MiCA (the CASP authorisation of the regulated sort — the MiCA framework of the regulated kinds: the CASP as the MiCA-authorised provider; the licence as the earned authorisation, per the regulatory chapters' law), the requirements are substantial (the capital and governance of the requirement sort — the custody and conduct of the substantial kinds: the requirements of the substantial sort; the CASP of the requirement kind), the authorisation is earned, not assumed light (the CASP authorisation of the earned sort — the light-regime assumption of the wrong kinds: the authorisation of the earned sort; the CASP of the earned kind), and the honesty formula opens: The CASP authorisation is earned under MiCA—the capital met, the governance built, the custody arranged, the conduct rules observed—not a light crypto regime — the capital met, the governance built, the authorisation earned: the CASP as a MiCA-earned authorisation; whoever treats crypto authorisation as a light regime assumes away MiCA's substantial requirements, and the CASP licence is earned under MiCA, not assumed a light regime. The requirement note of the standing echo: The authorisation is earned (the CASP authorisation of the earned sort — the light-regime assumption of the wrong kind: the CASP earned under MiCA, not assumed light, per the regulatory chapter).
The cross-reference note: The regulatory, CIF and substance chapters carry the neighbours — this chapter carries the MiCA CASP licence; the library earns its CASP under MiCA.
The Licence in Detail: MiCA, Requirements, Custody
The licence briefing of the crypto world: MiCA regulates crypto-asset services (the MiCA regulation of the framework sort — the EU crypto framework of the regulated kinds, per the regulatory chapter: MiCA of the framework sort; the CASP of the MiCA kind), the CASP authorisation is required (the CASP authorisation of the required sort — the crypto service provider licence of the authorised kinds: the CASP authorisation of the required sort; the licence of the CASP kind), the capital requirement reads (the CASP capital of the capital sort — the own funds by service of the capitalised kinds: the capital of the read sort; the CASP of the capital kind), the governance and fit-and-proper read (the CASP governance of the governance sort — the fit-and-proper management of the qualified kinds: the governance of the read sort; the CASP of the governance kind), the custody and safeguarding read (the crypto custody of the custody sort — the client asset safeguarding of the safeguarded kinds: the custody of the read sort; the CASP of the custody kind), the conduct and AML read (the conduct rules of the conduct sort — the AML and market-abuse of the compliant kinds: the conduct of the read sort; the CASP of the conduct kind), the CySEC authorisation reads (the CySEC CASP authorisation of the authorisation sort — the Cyprus regulator approval of the authorised kinds, per the regulatory chapter: the CySEC of the read sort; the CASP of the CySEC kind), the specialist handling reads (the CASP licensing of the specialist sort — the regulatory specialists and A. Panayiotou of the mandate kinds: the specialist of the handling sort; the CASP of the specialist kind), and the licence formula closes: meet the capital, build the governance, arrange the custody, observe the conduct. The CASP formula: Capital met plus governance built plus custody arranged plus conduct observed equals the MiCA authorisation — the requirement sentence of the CASP licence.
The specialist note of the standing sort: The CASP is specialist (the CASP licensing of the specialist sort — the regulatory specialists of the consulted kind: the CASP advised by regulatory specialists, with A. Panayiotou on the legal side and the CMC team coordinating).
Practice Lines: Earning the CASP Licence Right
The practice briefing of the crypto-provider world: The capital is met (the CASP capital of the capital sort — the own funds of the met kind), the governance is built (the CASP governance of the governance sort — the fit-and-proper of the built kind), the custody is arranged (the crypto custody of the custody sort — the safeguarding of the arranged kind), the conduct is observed (the conduct rules of the conduct sort — the AML of the observed kind), the CySEC authorisation is made (the CySEC CASP of the authorisation sort — the approval of the applied kind), the specialists are consulted (the CASP licensing of the specialist sort — the regulatory specialists of the consulted kind), and the practice formula closes: meet the capital, build the governance, arrange the custody, observe the conduct. The chapter's memory line: The CASP authorisation is earned under MiCA—the capital met, the governance built, the custody arranged, the conduct observed; those who meet the requirements earn the authorisation, while assumers of a light regime assume away MiCA's substantial requirements.
The closing classification: The MiCA and CASP licence for crypto in Cyprus is earned under MiCA's requirements—the capital met, the governance and fit-and-proper built, the custody and safeguarding arranged, the conduct and AML observed, the CySEC authorisation obtained—not a light crypto regime. The CMC team coordinates the CASP licensing with regulatory specialists and A. Panayiotou LLC's legal lane in every relevant mandate — the authorisation is earned under MiCA, not assumed a light regime.
Case Study: The Authorisation Earned Under MiCA
The earned-under-MiCA story: a crypto entrepreneur earned the CASP authorisation under MiCA's requirements rather than assuming a light crypto regime — the chronicle: The capital was met (the CASP capital of the capital sort — "I wanted to offer crypto-asset services and assumed crypto authorisation was light—a formality compared to traditional finance; my advisor corrected this: under MiCA, the CASP authorisation is earned through substantial requirements, comparable in seriousness to other financial licences", per the regulatory chapter), the governance was built (the CASP governance of the governance sort — "the governance requirements were real—a proper board, fit-and-proper management; MiCA holds crypto-asset service providers to genuine governance standards"), the custody was arranged (the crypto custody of the custody sort — "client asset safeguarding and custody were central—how client crypto assets are held and protected; a substantial requirement, not an afterthought"), the conduct was observed (the conduct rules of the conduct sort — "conduct rules and AML applied—market-abuse provisions, anti-money-laundering; the conduct framework was substantial"), the CySEC authorisation was made (the CySEC CASP of the authorisation sort — "the authorisation went through CySEC—the Cyprus regulator, applying MiCA; a real authorisation process", per the regulatory chapter), the specialists were consulted (the CASP licensing of the specialist sort — "and I worked with regulatory specialists and A. Panayiotou, CMC coordinating, because CASP licensing under MiCA is a specialist area"), and the balance closed earned: met, built, arranged — the authorisation earned under MiCA. The entrepreneur's verdict: "I earned the CASP authorisation under MiCA's requirements—capital, governance, custody, conduct—rather than assuming a light regime; the ones who assume a light crypto regime assume away MiCA's substantial requirements, and the CASP licence is earned under MiCA, not assumed light."
The lesson of the earned-under-MiCA story: The authorisation is earned under MiCA — the capital met, the governance built and the custody arranged; and earning it under MiCA versus assuming a light regime is the whole discipline.
Quick FAQ on the MiCA and CASP Licence
What is MiCA? The EU Markets in Crypto-Assets regulation — the framework regulating crypto-asset services. What is a CASP? A crypto-asset service provider — authorised under MiCA to provide crypto-asset services. Is crypto authorisation light? No — the CASP authorisation is earned through MiCA's substantial requirements: capital, governance, custody, conduct. What's required for custody? Client asset safeguarding — how client crypto assets are held and protected; a substantial requirement. Who authorises it in Cyprus? CySEC — the Cyprus regulator applies MiCA and authorises the CASP.
Three Takeaways on the MiCA and CASP Licence
First: It's earned under MiCA — not a light crypto regime. Second: Capital, governance, custody, conduct — MiCA's substantial requirements. Third: It's a specialist area — regulatory specialists and legal counsel. Three lines for the CASP file.
Glossary of the CASP Chapter
MiCA — the EU Markets in Crypto-Assets regulation. CASP — the crypto-asset service provider. CASP capital — the MiCA own-funds requirement. Crypto custody — the client-asset safeguarding requirement. CySEC authorisation — the Cyprus regulator's CASP approval. Five terms for the CASP file.
Self-Check: Five Questions on Your CASP Licence
The licence review: Is the CASP capital met? Is the governance—board and fit-and-proper—built? Is the custody and safeguarding arranged? Are the conduct and AML rules observed? And is the CySEC authorisation obtained? Five yeses: the authorisation is earned under MiCA. Every no assumes away MiCA's requirements.
Common Misconceptions About the MiCA and CASP Licence
Three corrections: "Crypto authorisation is light" — under MiCA, the CASP authorisation is earned through substantial requirements. "No real custody rules" — client asset safeguarding is a substantial MiCA requirement. "It's unregulated space" — MiCA regulates crypto-asset services; CySEC authorises and supervises. Three lines for the clear CASP view.
The One Sentence on the MiCA and CASP Licence
For the index card: The CASP authorisation is earned under MiCA's requirements—the capital met, the governance built, the custody arranged, the conduct observed, the CySEC authorisation obtained—not a light crypto regime. One sentence for the CASP file.
Further Reading in the CASP Cluster
The CASP chapter branches into the regulatory library: the regulatory chapters for the authorisation, the CIF chapter for the investment firm, the substance chapters for the operation, the AML chapters for the conduct. The cluster message: The CASP chapter is the crypto-authorisation desk of the regulatory library — the authorisation earned; the library earns its CASP under MiCA, not assumed a light regime.
Afterword: The CASP Licence Is Earned Under MiCA, Not Assumed a Light Regime
The closing thought: The entrepreneur's principle — the CASP licence is earned under MiCA, not assumed a light regime — corrects an assumption that crypto's history of light regulation invites, and the correction matters because crypto was long lightly regulated. Crypto-asset services were, for much of their history, lightly regulated or unregulated—operating in a space without the substantial authorisation regimes that traditional financial services face—so it's natural to assume that crypto authorisation remains light, a formality compared to the demanding licences of traditional finance, a legacy of crypto's less-regulated past; and this assumption can lead to underestimating what a CASP authorisation now requires. But MiCA has changed this: the EU Markets in Crypto-Assets regulation subjects crypto-asset service providers to a substantial authorisation regime—capital requirements, governance and fit-and-proper standards, custody and client-asset safeguarding rules, conduct and AML provisions—so the CASP authorisation is now earned through requirements comparable in seriousness to other financial licences, not the light regime crypto's past might suggest. The earn-under-MiCA discipline meets these requirements rather than assuming lightness: the capital met, the governance built (board, fit-and-proper management), the custody arranged (client asset safeguarding), the conduct observed (AML, market abuse), the CySEC authorisation obtained—the CASP authorisation earned through MiCA's substantial requirements rather than assumed a formality. And the custody requirement exemplifies the seriousness: MiCA takes client asset protection seriously (as financial regulation generally does), so the safeguarding of client crypto assets is a substantial requirement—how assets are held, protected, segregated—not the afterthought that a light-regime assumption might suppose, reflecting MiCA's treatment of crypto services as genuine financial services deserving genuine regulation. This is the library's earned-not-assumed principle applied to the CASP licence, closely paralleling the CIF licence: the same discipline that earns the CIF licence through CySEC's requirements, here earning the CASP under MiCA's—the crypto authorisation now, like the investment-firm authorisation, a substantive licence rather than a formality. So earn the CASP authorisation under MiCA's requirements—the capital, governance, custody, conduct—rather than assuming a light crypto regime. Crypto's lightly-regulated past invites assuming its authorisation stays light—but MiCA subjects crypto-asset service providers to substantial requirements, and the CASP licence is earned under MiCA, not assumed a light regime, so the entrepreneur who meets MiCA's requirements earns the authorisation, while the one who assumes a light regime assumes away requirements that MiCA, bringing crypto services into serious financial regulation, now genuinely imposes.
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This article is for general guidance and does not replace individual advice. Every case has its specifics – the type of income, personal circumstances, tax history and long-term objectives all significantly influence the optimal structure.
The CMC team supports establishment, substance and tax integration of your CASP structure. Book a free initial consultation: Book appointment · kontakt@steuerberater-zypern.info · WhatsApp +357 95 140797
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