MiCA Deadline Could Push 75% of Europe’s Crypto Firms Out of Legal Status: Report

Highlights:

• MiCA’s final transition deadline could reshape Europe’s crypto market after July 1.
• Hogan Lovells expects around 75% of earlier VASP registrations to lose legal status.
• Fewer licensed firms may protect users, but could also push demand to offshore platforms.

Europe’s crypto market is entering a major turning point as the final transition periods under the Markets in Crypto-Assets Regulation (MiCA) are set to end on July 1. International law firm Hogan Lovells said in a June 13 publication that the deadline will show how much the European Union’s new crypto rulebook has really improved the market.

MiCA was designed to create one clear legal framework for crypto companies across the EU. Before MiCA, crypto firms had to deal with different national rules in different countries. Many firms operated primarily under anti-money laundering registration systems, but those registrations did not allow them to serve the entire EU market with a single approval.

The new regime changes that. MiCA covers a wider range of areas, including market access, disclosures, governance, financial safeguards, supervision, and rules for crypto service providers. Its goal is to provide investors with greater protection while creating a cleaner, more stable crypto market.

MiCA Transition Ends on July 1: Approximately 75% of EU Crypto Companies May Lose License

The EU’s MiCA transition period will end on July 1, after which crypto exchanges, brokers and wallet service providers without a MiCA license will no longer be able to serve EU users.

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— Wu Blockchain (@WuBlockchain) June 15, 2026

MiCA Raises the Bar for Crypto Firms

Hogan Lovells said Europe had more than 3,000 registered virtual asset service providers two years ago, based on industry estimates. Poland alone had more than 1,400 registrations. However, by May, only 194 crypto-asset service providers, including credit institutions, had received authorization under MiCA.

The firm expects around 75% of the pre-MiCA VASP market to lose registration status once the transition periods expire. That shows MiCA is raising the compliance standard across Europe. At the same time, it also creates pressure on smaller firms that may not have the money, staff, or systems needed to meet the new rules.

As a result, MiCA is not only harmonizing the crypto market. It is also filtering who can stay in it. Larger and better-prepared companies are more likely to secure licenses, while smaller or less prepared firms may leave the market.

Stricter Licensing Could Create New Risks for Users

MiCA aims to protect consumers, but Hogan Lovells warned that fewer authorized firms could create a new problem. Crypto demand may not fall just because fewer companies are allowed to operate. If users cannot access services through approved platforms, they may turn to offshore or non-compliant providers.

That could weaken MiCA’s consumer protection goal. Users who move to unregulated platforms may face risks such as fraud, market manipulation, or misuse of funds. Hogan Lovells also noted that EU investors continue to access non-compliant stablecoins through decentralized exchanges outside MiCA’s scope.

The report also said innovation remains a challenge. Many crypto firms still struggle to access basic banking services, while high compliance costs may reduce competition. Areas such as decentralized finance, staking, and crypto lending also remain unclear under the current law.

Regulators Move Toward Stricter Enforcement

As the deadline approaches, regulators are becoming more active. National authorities from issuing warnings to increased enforcement, Hogan Lovells said. Italy’s CONSOB has mandated that some crypto service providers stop their activities, and France’s AMF has maintained its blacklists and public warnings of unauthorized providers.

The firm also highlighted an emerging debate in the EU over whether the European Securities and Markets Authority should directly regulate major crypto companies. This might lead to uniform supervision over the EU, supporters say. Critics are concerned that it would drive up costs and diminish the powers of local regulators. 

With MiCA, Europe has one of the world’s most sophisticated crypto rulebooks. But its next step will determine if it safeguards consumers, fosters innovation, and creates a genuinely open single market for crypto services.