Cryptocurrency Trading Companies Boost Spending on Sophisticated Monitoring Technologies

A study conducted by Acuiti demonstrates a projected rise in investments for crypto trading surveillance technologies due to the implementation of the Markets in Crypto Assets Regulation (MiCA) within the EU.

The research, dubbed `The Impact of MiCA on Crypto Market Surveillance: Insights and Challenges`, was initiated by Eventus. It compiled insights from a survey and respective interviews with decision-makers from 68 entities involved in cryptocurrency exchanges, including those on the buying side, selling side, and trading platforms. This further evidences the sector-wide push towards the adoption of robust market surveillance mechanisms.

Key Insights from the Study

As one of the premier extensives regulatory schemes for crypto trading in a significant economy, MiCA will lay down new criteria impacting market players in various domains. The report’s findings state that a mere 9% of companies impacted by MiCA are entirely ready for it, with 25% having made no strides in preparation. With MiCA anticipated to be enacted at the year’s closure, businesses should quickly ascertain their eligibility under its purview and kick-start compliance measures.

Market surveillance conditions proposed by MiCA are in step with prescriptions from the EU’s Market Abuse Regulation (MAR). A host of enterprises, particular newcomers under the MiCA gamut, will need to surmount sizeable operational barriers to implement adequate compliance systems. Uncertainty prevails among many companies as to whether they fall within the reach of MiCA.

Currently, with a forward-looking approach to market surveillance, 57% of institutions not governed by MiCA have taken the initiative to implement surveillance systems. Despite the ongoing discourse on the definitive technical standards, one-fourth of MiCA-impacted businesses have yet to commence groundwork, close to a third are in preliminary phases, and just over a third have considerably progressed in readiness.

Organizations in the process of adopting new infrastructure are mainly contracting the work to external software providers, with 64% indicating plans toward such partnerships. Nonetheless, numerous firms are expecting hurdles in the selection process to find vendors that meet their unique operational criteria.

Among the critical challenges presented by MiCA are the burden of associated compliance costs and the hunt for proficient talent. Firms that are currently non-compliant with MIFID II are set to encounter considerable operational impediments due to MiCA, pressing a majority to consider expert assistance from specialized software companies.