MiCA's Cleanup Crew: 1,700 Firms Out, 323 Licensed, and the Scammers Are Already Photobombing 🪙

European Union watchdogs are warning of a surge in impersonation scams targeting customers of crypto service providers that failed to secure authorization under the bloc's Markets in Crypto-Assets (MiCA) Regulation by the July 1 deadline. Unlicensed firms must wind down or transfer their EU operations, forcing users to move their holdings, a transition criminals are exploiting by posing as regulators and licensed exchanges.

The European Securities and Markets Authority (ESMA) said it is aware of "fraudulent practices involving the misuse of ESMA's logo and identity," including falsified documents used to promote scams. France's Autorité des Marchés Financiers (AMF) has recorded cases of fraudsters posing as its own staff, directing customers of unlicensed firms to transfer assets through fake websites. "This moment is an opportunity for scammers more than usual," Stéphane Pontoizeau, an executive director at the AMF, told the Financial Times. He added that the regulator will refer cases to law enforcement where criminals impersonate it or licensed companies. The Dutch Authority for the Financial Markets (AFM) urged traders to treat any third-party request to move funds with caution and verify it against the provider's official website and app.

The scale of the disruption is substantial. An ESMA list updated at the end of July shows only 323 crypto companies have obtained MiCA licenses. Data provider VASPnet previously estimated that more than 1,700 unlicensed companies would need to cease operations. The AMF has declined to set an aggressive wind-down date for unlicensed firms in France, reasoning that manufactured urgency is what pushes people into scams, and has urged customers to take their time choosing a replacement provider.

Among the licensed firms are Coinbase, Kraken and OKX. Binance, the largest operator without one, withdrew its application in Greece in June after reports that the regulator would reject it, and said it would seek approval elsewhere. Spain's securities regulator ruled out any extension days before the cut-off, and MiCA replaced a patchwork of national regimes with a single authorization that passports across all 27 member states.

Separately, Chainalysis put losses to crypto scams and fraud at $17 billion last year, a projection based on historical trends, against $6 billion five years earlier.