ESMA published a new question and answer document on October 17, 2023, regarding the use of payment accounts by crypto-asset service providers (CASPs). The document clarifies that an authorized CASP may temporarily hold clients' funds in an account with a non-bank payment service provider, provided adequate arrangements safeguard clients' ownership rights.
The guidance relies on Article 70(2) of the Markets in Crypto-Assets Regulation (MiCA). It emphasizes the importance of maintaining client ownership rights and ensuring that funds are eventually transferred to accounts held with credit institutions or central banks.
The guidance specifically applies to authorized CASPs that utilize non-bank payment service providers for client fund management. Compliance teams at these CASPs should review their current practices to ensure alignment with this guidance.
The document does not specify any deadlines, transitional periods, exemptions, or carve-outs. It focuses on the need for CASPs to implement necessary safeguards to protect clients' ownership rights as stipulated in MiCA.