ESMA launches consultation to define crypto advisor standards across Europe

The European Securities and Markets Authority (ESMA) launched a public consultation on guidelines to assess the knowledge and competence of professionals providing crypto-asset services under the Markets in Crypto-Assets Regulation (MiCA).

The consultation, published on Feb. 17, aims to standardize the qualifications and experience required for individuals advising on or informing clients about digital assets.

Minimum competency standards

The draft guidelines establish clear criteria for professional qualifications, work experience, and continuous education for staff employed by crypto-asset service providers (CASPs).

Under the proposal, individuals providing investment advice on crypto-assets must meet stricter competency requirements than those offering basic informational services.

ESMA outlined that advisors must hold a tertiary education degree or equivalent, undergo at least 160 hours of professional training, and have at least one year of relevant experience. Those providing general information on crypto-assets would require a professional qualification of at least 80 hours and six months of supervised experience.

All professionals must undergo an assessment exam and complete ongoing training — a minimum of 10 hours annually for information providers and 20 hours for advisors — to ensure their knowledge remains up to date.

The guidelines also emphasize the importance of understanding crypto-specific risks, including market volatility, cybersecurity threats, blockchain governance, and liquidity risks associated with major asset holders.

Additionally, ESMA proposes that firms conduct annual internal reviews to assess staff compliance with these standards.

Regulatory implications

The consultation comes as MiCA’s provisions governing crypto-asset services take effect across the EU, with full implementation expected in 2025. The regulation seeks to establish a harmonized legal framework for digital assets, covering transparency, investor protection, and prudential oversight.

ESMA noted that the growth of the crypto industry warrants higher standards of operation to ensure investors remain protected.

According to the regulator:

“The rapid expansion of crypto markets has increased risks, particularly for retail investors. Ensuring that service providers maintain a baseline level of expertise is crucial for investor protection and market integrity.”

The guidelines closely align with existing MiFID II rules for financial markets but introduce crypto-specific considerations, reflecting the unique nature of blockchain-based assets.

Market participants, including CASPs, investors, financial institutions, and industry associations, are invited to provide feedback on the proposed standards.

ESMA will accept comments until April 22, 2025, and expects to publish the final guidelines in the third quarter of the year.