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Re:

Can You Keep or Transfer a Non-Compliant Stablecoin in the EU?

ESMA distinguishes holding and transferring a non-compliant stablecoin from trading it. Here is what EU holders should know about provider support, custody safeguards and the expired 2025 transition dates.
From TheFinanceBase Team4 min to read
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Usually, a non-MiCA-compliant stablecoin may still be held in custody and transferred, but EU platforms are expected to stop offering it for trading and certain services that facilitate buying it. ESMA set out that distinction in January 2025. It is a supervisory expectation—not a guarantee that every provider will support a particular token, network or withdrawal route.

What “non-compliant stablecoin” means under MiCA

“Stablecoin” is a general term, not the legal category that determines how MiCA applies. The regulation distinguishes, among other crypto-assets, asset-referenced tokens (ARTs) and e-money tokens (EMTs). Broadly, an EMT purports to maintain a stable value by referencing one official currency. An ART references another value or right, or a combination of them, subject to MiCA’s statutory definition. The definitions and requirements are set out in Regulation (EU) 2023/1114.

Whether a token is affected depends on its classification, the issuer and offer or admission-to-trading status, any applicable transition arrangements, and what service a crypto-asset service provider (CASP) supplies. A token’s name or apparent peg alone does not settle the question. ESMA said CASPs should consult their relevant national competent authority if classification is uncertain.

Which services are expected to stop—and which are different

In its 17 January 2025 statement, ESMA said platforms were expected to stop making non-compliant ARTs and EMTs available for trading. It also expected certain related services to cease where they amount to an offer to the public. The distinction is between facilitating an offer or acquisition and the separate act of keeping or moving a client’s existing token.

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Service ESMA’s stated treatment What it means for a holder
Platform trading or making the token available for trading Expected to stop for non-compliant ARTs and EMTs. A listing, buy button or other trading function may be removed.
Receiving or transmitting orders, executing orders, or exchanging the token for funds or other crypto-assets Expected to cease when the service constitutes an offer to the public. New purchases and related transactions may be restricted.
Sell-only service ESMA said it could continue through the end of Q1 2025 to allow an orderly exit. This was part of the announced transition schedule, not an ongoing entitlement.
Mere custody and transfer ESMA said these should remain possible. Check the provider’s current support for the token, network and withdrawal route.
Transfer following withdrawal of a CASP’s authorisation MiCA separately requires procedures for timely and orderly transfer of client assets and funds to another CASP. This rule concerns the provider losing its authorisation, not the token’s trading status.

The service distinctions and transition schedule come from ESMA’s statement on services involving non-MiCA-compliant ARTs and EMTs. The provider-authorisation transfer requirement is in MiCA.

What custody and transfer mean in practice

ESMA’s statement says mere custody and transfer should remain possible, while requiring investors to be clearly informed about restrictions and the risk of worse execution conditions if they continue holding the affected tokens. That is a supervisory expectation; it does not promise that a particular exchange or custodian will offer every token, network or withdrawal method. A provider may also change its supported routes or product availability.

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Do not infer that a trading halt itself ends custody or makes an on-chain transfer impossible. Equally, a working withdrawal route does not mean that buying, selling or exchanging the token through the same provider remains available. For your own account, check the provider’s latest token notice and withdrawal screen for:

  • whether the provider still holds the specific token in custody;
  • which blockchain networks and withdrawal routes it supports;
  • whether withdrawals require a minimum amount, incur a fee or have a deadline stated by the provider; and
  • whether any sell-only, conversion or other account-specific arrangement is currently offered.

Confirm the destination address and network before initiating a transfer. The relevant point here is provider-specific: ESMA’s general expectation does not establish that a route is available for an individual account.

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Custody protections still apply

MiCA’s custody rules are separate from the restriction on offering or trading a non-compliant token. A CASP providing custody must safeguard clients’ ownership rights and prevent use of clients’ crypto-assets for its own account. The regulation also requires a client agreement, position records, a custody policy, segregation of client assets from the CASP’s own assets, and procedures to return the assets or the means of access as soon as possible. See MiCA Article 70 on safekeeping and Article 75 on custody and administration.

If the CASP’s authorisation is withdrawn, MiCA requires it to have procedures for a timely and orderly transfer of clients’ crypto-assets and funds to another CASP. This is a provider-level safeguard; it is not a special withdrawal right triggered simply because one token is non-compliant.

The 2025 transition dates have passed

ESMA’s January 2025 statement said acquisition-facilitating services should generally be restricted by the end of January 2025. It allowed for sell-only service to continue until the end of Q1 2025 to give EU investors an opportunity to liquidate or convert positions, and expected national authorities to ensure compliance as soon as possible and no later than the end of that quarter. Those were announced transition milestones, not a current grace period.

If you hold a potentially affected token now, rely on the provider’s current notice and account controls rather than assuming the historical transition arrangement still applies. For a classification dispute or a token-specific compliance question, the relevant national competent authority is the appropriate supervisory channel identified by ESMA.

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Token redemption is not the same as an exchange withdrawal

MiCA gives holders of ARTs a permanent right to redemption against the issuer, subject to the regulation’s terms. That issuer obligation does not itself require an exchange to convert the token for you or provide a particular withdrawal route. Do not assume this ART-specific rule applies to every EMT; check the applicable legal framework and issuer terms for the token in question.

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