Passporting a MiCA CASP licence across the EU: how it works and what it does not cover
Passporting a MiCA CASP licence allows a crypto asset service provider authorised in one EU member state to offer services across the entire European Economic Area without separate national licences, but the passport does not cover all regulatory obligations.
What is passporting under MiCA?
Under the Markets in Crypto Assets Regulation (MiCA), a Crypto Asset Service Provider (CASP) that obtains authorisation from the competent authority in its home member state can passport its licence to other EU/EEA countries. This means the CASP can provide its services in any member state without needing a separate licence from each local regulator. The passporting mechanism is designed to create a single market for crypto services, reducing regulatory fragmentation and compliance costs for firms operating across borders.
To exercise passporting rights, the home regulator notifies the host member state's competent authority of the CASP's intention to offer services. The host authority cannot impose additional requirements on the CASP beyond those already satisfied under MiCA. However, the passport does not exempt the CASP from other applicable EU laws, such as anti money laundering (AML) rules, data protection under GDPR, or national marketing and consumer protection regulations.
How does the passporting process work?
The process begins when a CASP submits a passporting notification to its home regulator, including details of the services it intends to offer in other member states and the countries where it will operate. The home regulator then verifies the notification and forwards it to the host regulators within a specified timeframe, usually 30 days. The CASP can start providing services in the host member state once the home regulator confirms the notification has been sent.
It is important to note that the passporting process is administrative rather than discretionary. Host regulators cannot refuse the passport unless the CASP's activities pose a serious threat to the host market's integrity or consumer protection. In practice, the process is straightforward for CASPs that already comply with MiCA's requirements. However, firms must ensure they maintain ongoing compliance with home state supervision, as the home regulator remains the primary supervisor for passporting activities.
What does the MiCA passport cover?
The MiCA passport covers all services listed in Article 3(1) of MiCA, including custody and administration of crypto assets, operation of a trading platform, exchange of crypto assets for fiat currency or other crypto assets, execution of orders, placement of crypto assets, reception and transmission of orders, and advisory services. A CASP authorised for one service can passport that specific service to other member states. If the CASP later adds a new service, it must seek an extension of its authorisation from the home regulator before passporting that service.
The passport also covers the right to establish a branch in another member state or to provide services on a cross border basis without a physical presence. However, the passport does not grant a CASP the right to offer services that are not included in its authorisation or to engage in activities that fall outside MiCA's scope, such as decentralised finance (DeFi) protocols that are not considered CASP services.
What does the MiCA passport not cover?
The MiCA passport does not cover compliance with national AML/CFT requirements. Each member state may impose its own AML obligations, such as registration with a local financial intelligence unit or appointment of a local AML officer. Similarly, the passport does not extend to tax obligations; a CASP must comply with the tax laws of each host member state where it provides services, including VAT and corporate income tax rules. Marketing and advertising rules also remain under national competence, so a CASP must ensure its marketing materials comply with local consumer protection laws.
Additionally, the passport does not cover services related to non MiCA compliant crypto assets, such as security tokens or e money tokens, which are regulated under other EU frameworks like MiFID II or the E Money Directive. If a CASP offers such services, it may need separate licences under those regimes. The passport also does not apply to activities outside the EU/EEA; a CASP wishing to serve clients in third countries must comply with local regulations there.
Practical considerations for CASPs passporting across the EU
Before initiating passporting, a CASP should assess the regulatory market in each target member state, including local AML requirements, tax laws, and any additional national rules that may apply. Some member states have implemented stricter consumer protection measures or require local representation for AML purposes. Engaging local legal counsel is advisable to handle these nuances. The home regulator will remain the primary supervisor, but host regulators have the power to take enforcement action if the CASP violates local laws.
Another key consideration is the capital requirement under MiCA. CASPs must maintain minimum capital based on their activity class: EUR 50,000 for certain services, EUR 125,000 for others, and EUR 150,000 for the highest risk activities. These capital requirements apply at the entity level, not per jurisdiction, so passporting does not increase capital obligations. However, the CASP must ensure it has adequate operational capacity to serve clients across multiple jurisdictions, including multilingual support and compliance with local data protection laws.
Alternatives to MiCA passporting: Panama and other non EU jurisdictions
For crypto founders who prefer to operate outside the EU regulatory framework, jurisdictions like Panama offer a different approach. Panama does not have a dedicated crypto licence; instead, firms can incorporate a Sociedad Anonima and benefit from 0% tax on foreign source income. Setup takes 2 to 3 weeks and costs are relatively low. However, Panama's regulatory environment is less established, and firms may face challenges accessing EU markets or banking services.
Other non EU jurisdictions such as Singapore, the UAE, or Switzerland have their own crypto licensing regimes that may be more suitable depending on the business model. Each has its own advantages and limitations. Ultimately, the choice between passporting a MiCA CASP licence and opting for a non EU jurisdiction depends on the target market, the nature of services, and the founder's risk appetite. For EU focused operations, MiCA passporting provides a clear and harmonised path, while non EU options offer flexibility but with less regulatory certainty.
How to Choose the Right Jurisdiction
Work the decision in this order — customers first, everything else second:
- Who are your customers? EU retail means you need a MiCA passport (Lithuania, Malta or another EU CASP). US customers mean state-by-state money-transmitter licensing or a FinCEN MSB — consider a Canada MSB or a US setup. Latin America, Asia or HNW clients mean an offshore or territorial base such as Panama is usually the better fit.
- Do you need a regulator badge? A public-facing exchange chasing institutional partners and fundraising often needs the reputational lift of an EU, Swiss or VARA licence. An OTC desk or token treasury usually does not.
- What is your budget and timeline? Offshore and territorial routes set up in weeks for tens of thousands; premium onshore licences take many months and six figures.
- What about tax? Territorial-tax jurisdictions like Panama charge 0% on foreign-source income; EU jurisdictions apply standard corporate tax. Factor total cost of ownership, not just setup fees.
For many offshore-first founders, Panama lands at the intersection of fast incorporation, low cost and 0% tax on foreign-source income, which is why it features so heavily in our work. But the honest answer is that the “best” jurisdiction is the one that matches the four answers above — and that is a conversation worth having before you spend a cent. See our cost breakdown and application process to ground the decision in real numbers.
Banking and Compliance: Where Most Setups Actually Stall
Incorporation is the easy part of any crypto project. Banking is where timelines slip and where under-prepared founders lose months. Since 2023, banks and payment processors worldwide have tightened their onboarding of crypto-adjacent businesses, and they now expect a genuinely professional application — not a one-page business summary. A thin file is simply rejected, and re-applying with the same bank is far harder than getting it right the first time.
Three documents do the heavy lifting. The first is a written AML/KYC compliance program: your customer-onboarding flow, transaction-monitoring rules, sanctions and PEP screening, a named compliance officer, and record-keeping policies. The second is a clear, evidenced source-of-funds file for both the company and its beneficial owners. The third is a coherent business description that explains who your customers are, how money moves, and what volumes you project. Banks approve businesses they understand; ambiguity reads as risk.
Sequencing matters as much as substance. The correct order is: incorporate the operating entity, build the compliance program, assemble the source-of-funds package, and only then approach banking — ideally through a warm introduction rather than a cold application. Founders who approach banks mid-setup, before their file is complete, create the very delays they are trying to avoid. We make direct introductions to banks and crypto-friendly payment rails as part of every engagement, but the introduction only works if the file behind it is ready.
None of this is optional, and none of it changes much from one jurisdiction to the next — the compliance bar is now broadly global. What changes is the appetite of local banks and the speed of onboarding. Our requirements checklist sets out exactly what you need to assemble before you approach a bank.
Crypto Licensing in 2026: The Bigger Picture
Choosing where to license a crypto business in 2026 is no longer a simple cost calculation. The regulatory map has hardened considerably over the last three years. In the European Union, the Markets in Crypto-Assets Regulation (MiCA) has replaced the patchwork of national VASP registers with a single Crypto-Asset Service Provider (CASP) authorisation that passports across all 27 member states. That passport is powerful — but it comes with capital requirements, governance obligations and a multi-month authorisation process that smaller projects often underestimate.
Outside the EU, the picture is more varied. Offshore and territorial-tax jurisdictions compete on speed, cost and privacy, while major financial centres such as Switzerland, the UAE and Singapore compete on credibility and institutional access. The Financial Action Task Force (FATF) sits over all of them: its “travel rule” and AML standards now apply, in some form, almost everywhere a serious crypto business would consider basing itself. Jurisdictions that ignore FATF expectations end up grey-listed, which quietly closes correspondent-banking doors for every company registered there.
This is why the question behind Passporting a MiCA CASP is rarely “which licence is cheapest?” It is “which regime matches my customers, my risk appetite and my banking needs?” An EU-retail exchange and an offshore OTC desk serving high-net-worth clients in Latin America have almost nothing in common in terms of the right base. Getting this decision right at the start saves you from the single most expensive mistake in the industry: licensing in the wrong place and having to re-domicile a live business.
Consulting24 has guided more than 200 crypto company setups across 15+ jurisdictions since 2017, which means we have seen how each of these regimes behaves in practice rather than just on paper. The summary below is the same framework we use with clients — and we are always happy to map it to your specific model. Start with our Panama vs Lithuania comparison to see how the trade-offs play out between an offshore base and an EU-passported one.
Common Mistakes to Avoid
The failures we see when founders research Passporting a MiCA CASP on their own are remarkably consistent, and almost all of them are avoidable. The first is licensing to the headline tax rate. A 0% jurisdiction is worthless if your customers legally require a regulated provider you cannot become there — you will simply have to start again. Decide who you are allowed to serve first, then optimise for tax.
The second is treating the compliance program as paperwork. The AML/KYC program is not a formality to satisfy a regulator; it is the document your bank reads most closely. A generic template downloaded from the internet is transparent to any compliance officer and will sink your banking application. It needs to reflect your actual product, customer base and risk profile.
The third is underestimating banking lead time. Founders routinely budget for incorporation and forget that the bank account — the thing that actually lets the business operate — can take longer than the licence itself. Build banking into your launch timeline from day one, not as an afterthought.
The fourth is ignoring personal tax residency. A company in a low-tax jurisdiction does not erase your obligations where you personally live. Many founders create unexpected liabilities by structuring the company perfectly and ignoring themselves. We introduce qualified tax advisors precisely to close this gap.
The fifth and most expensive is choosing a provider on price alone. The cheapest setup that results in a rejected bank application or a re-domiciliation is far more expensive than doing it properly once. Ask any provider to itemise their fee and explain their banking track record before you commit.
What Happens After You Are Licensed
Getting licensed and banked is the start, not the finish. Every regulated or registered crypto business carries ongoing obligations, and letting them lapse is how companies lose their standing — and their banking. At minimum you will maintain a registered agent or local presence, file annual renewals or supervision fees, keep accounting records, and keep your compliance program live with periodic reviews and updated sanctions and PEP screening lists.
Most jurisdictions also expect you to keep your beneficial-ownership information current and to report material changes — new directors, new shareholders, a pivot in business activity — promptly. Transaction monitoring is not a one-time setup either; screening rules need tuning as your volumes and customer mix evolve. Banks may request periodic refreshes of your KYC and source-of-funds documentation, particularly after a year of trading or a significant change in activity.
This is why we offer ongoing maintenance on an annual retainer rather than treating setup as a one-off transaction. The cost of staying compliant is a fraction of the cost of losing a banking relationship and having to rebuild one from scratch. Plan for it in your year-two budget from the outset, and treat your compliance function as a living part of the business rather than a box you ticked at launch.
It is also worth planning ahead for growth. A structure that suits a pre-revenue startup may not suit the same company once it is processing meaningful volume, adding new product lines, or expanding into new markets. Many of the businesses we work with begin in a fast, low-cost offshore base to validate the model, then add a second regulated entity — an EU CASP, for example — once revenue justifies the cost and the market access genuinely matters. Designing the first structure with that possible second step in mind keeps your options open and avoids a disruptive re-domiciliation later. We map this growth path out with clients during the initial planning stage so the early decisions support, rather than constrain, where the business is heading.
Consulting24 has completed 200+ crypto company setups across 15+ jurisdictions. Talk to our team for a fixed-fee proposal and realistic timeline.
Learn more WhatsApp usEmail mardo@consulting24.co · Phone +372 58155779
About Consulting24 & Mardo Soo
Founder & CEO, Consulting24 · LinkedIn
Consulting24 is an eight-year-old advisory firm that has completed 200+ crypto company setups across 15+ jurisdictions since 2017. Founder and CEO Mardo Soo and the team specialise in crypto, VASP and exchange licensing — from Panama and the EU (MiCA) to Dubai, Canada and the offshore world. We don't push a single “best” jurisdiction; we map your business to the regime that actually fits, then handle incorporation, the AML/KYC compliance program, and banking and payment-processor introductions end to end.
Every engagement begins with an honest conversation about your customers, budget and timeline and ends with a fixed-fee proposal, so you know the all-in number before you commit. We also introduce vetted local lawyers and tax advisors wherever your structure requires them.
Operated by X24Consulting OÜ (Estonian Business Register code 16971898), Põrdi tn 3-63, 10156 Tallinn, Estonia · mardo@consulting24.co · +372 58155779
Frequently Asked Questions
What is passporting a MiCA CASP licence?
Passporting allows a CASP authorised in one EU member state to offer its services in other EU/EEA countries without needing separate licences from each host regulator. The home regulator notifies the host regulators, and the CASP can then operate across borders under a single authorisation.
Which services are covered by the MiCA passport?
The passport covers all CASP services listed in MiCA, including custody, trading platform operation, exchange, order execution, placement, reception and transmission of orders, and advisory services. Only services for which the CASP is authorised can be passported.
Does the MiCA passport cover AML compliance?
No. Each EU member state has its own AML/CFT requirements. A CASP must comply with local AML laws in each host country, which may include registration with the local financial intelligence unit or appointment of a local AML officer.
Can a CASP passport its licence to non EU countries?
No. Passporting only applies within the EU and EEA. To offer services in non EU countries, a CASP must comply with the local regulatory requirements of those countries.
What are the capital requirements for a MiCA CASP?
Minimum capital requirements depend on the activity class: EUR 50,000 for certain services, EUR 125,000 for others, and EUR 150,000 for the highest risk activities. These apply at the entity level, not per jurisdiction.
How long does the passporting process take?
The process typically takes around 30 days from the time the home regulator receives the notification, though this can vary depending on the regulator's workload and the completeness of the submission.
Can a host regulator refuse a passport?
Host regulators cannot refuse a passport unless the CASP's activities pose a serious threat to market integrity or consumer protection. In practice, refusals are rare if the CASP complies with MiCA.
Does Panama have a crypto licence?
No, Panama does not have a dedicated crypto licence. Crypto businesses typically incorporate a Sociedad Anonima and benefit from 0% tax on foreign source income. Setup takes 2 to 3 weeks.
Related reading
More crypto-license guides on this blog
- Crypto License in Panama: Cost, Requirements & Setup (2026)
- Crypto Exchange License: How and Where to Get One in 2026
- Crypto License Cost by Jurisdiction: 2026 Comparison
Related crypto licensing routes
A few relevant guides on consulting24.co, each with real cost, timeline and requirements:
This article reflects 2026 market conditions and is general guidance, not legal or tax advice. Regulations change — confirm specifics with qualified counsel before acting. Consulting24 (X24Consulting OÜ, Estonian reg. 16971898) introduces vetted local lawyers and tax advisors during every engagement.
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