Passporting a MiCA CASP Licence Across the EU: How It Works and What It Does Not Cover
Passporting a MiCA CASP licence is a key feature of the European Union's Markets in Crypto-Assets Regulation, which came fully into force in 2026. For crypto firms holding a Crypto Asset Service Provider (CASP) licence in one EU member state, passporting allows them to offer services across all other EU member states without needing separate local licences. This single-market passport is designed to reduce regulatory friction and enable cross-border scaling for compliant crypto businesses.
However, passporting has important limitations. It does not automatically grant access to non-EU markets, and certain local requirements-such as tax registration, AML reporting, and marketing rules-may still apply. Understanding exactly what passporting covers and what it does not is critical for any crypto founder planning an EU expansion strategy. This guide provides a factual, up-to-date overview of the MiCA passporting regime, its practical operation, and the strategic choices available to firms, including alternatives like Panama.
What Is Passporting a MiCA CASP Licence?
Passporting is a regulatory mechanism that allows a CASP authorised in one EU member state (the home state) to provide its services in any other EU member state (the host state) without obtaining a separate licence. Under MiCA, once a firm is registered and supervised by its home state regulator-for example, the Bank of Lithuania or the Spanish CNMV-it can notify that regulator of its intention to passport into other states. The home regulator then communicates this to host state regulators, and the firm can begin operations after a short waiting period.
This process is similar to the passporting regime used for traditional financial services under MiFID II and the Payment Services Directive (PSD2). For crypto firms, passporting eliminates the need to duplicate compliance efforts, capital requirements, and regulatory filings across multiple jurisdictions. It is one of the most significant advantages of obtaining a MiCA CASP licence in the first place.
Who Needs to Understand Passporting?
Any crypto firm planning to offer services to customers in more than one EU country should understand passporting. This includes:
- Exchange platforms wanting to operate across the EU from a single base
- Wallet providers targeting multiple member states
- Custodians serving institutional clients in different jurisdictions
- Token issuers and DeFi projects that need to comply with MiCA
Even if your firm is currently focused on one EU market, passporting may become relevant as you scale. Conversely, if you only intend to serve non-EU clients, a MiCA licence and passporting may not be necessary. Consulting24 advises firms on whether a Lithuania crypto licence or a Panama setup is more appropriate based on their target markets.
License Type and Regulator Under MiCA
Under MiCA, the relevant licence is the CASP (Crypto Asset Service Provider) authorisation. Each EU member state designates a competent authority to issue and supervise CASPs. For example:
| Country | Regulator |
|---|---|
| Lithuania | Bank of Lithuania |
| Estonia | Financial Supervision Authority (FSA) |
| Spain | Comisión Nacional del Mercado de Valores (CNMV) |
| France | Autorité des Marchés Financiers (AMF) |
Once authorised, the CASP can passport under MiCA. The home regulator remains the primary supervisor, but host regulators can request information and take limited actions. Consulting24 delivers direct licensing in Lithuania and Estonia and coordinates with local experts in other EU states.
Cost and Timeline for Passporting
The cost of passporting itself is relatively low-mainly administrative fees and legal support for the notification process. However, the underlying CASP licence application is the major expense. Below is a typical cost and timeline overview for obtaining a MiCA CASP licence and then passporting:
| Item | Estimated Cost (EUR) | Timeline |
|---|---|---|
| CASP licence application (Lithuania example) | From EUR 50,000 (including legal, compliance setup) | 3-6 months |
| Capital requirement (minimum) | EUR 50,000 / 125,000 / 150,000 depending on services | Paid up before authorisation |
| Passporting notification | EUR 2,000 - 5,000 (legal fees) | 1-2 months after licence |
| Ongoing compliance (annual) | EUR 20,000 - 50,000+ | Continuous |
For exact pricing, a consultation is required as costs vary by jurisdiction and service scope. Consulting24 provides transparent quotes for crypto licence costs.
Capital Requirement Under MiCA
MiCA imposes tiered minimum capital requirements for CASPs based on the types of services provided:
- EUR 50,000 for simple services like custody and administration of crypto assets
- EUR 125,000 for exchange services (crypto-to-fiat and crypto-to-crypto)
- EUR 150,000 for more complex services including execution of orders on behalf of clients
These are minimums; national regulators may require higher capital based on risk assessments. The capital must be held as own funds and cannot be used. Passporting does not reduce these requirements-the home state capital applies across all host states. For firms that find EU capital requirements burdensome, Panama offers a flat fee of EUR 6,000 with no minimum capital, making it a cost-effective alternative for non-EU operations.
Tax Treatment When Passporting
Passporting a MiCA CASP licence does not harmonise tax treatment. Each EU member state retains its own tax laws regarding crypto assets. For example, Germany treats crypto as private assets with a one-year holding period exemption, while France has a flat 30% tax on capital gains. When passporting, your firm may become subject to host state corporate income tax if it has a permanent establishment there. VAT treatment of crypto services also varies.
Tax planning is essential. Many firms choose to centralise operations in a jurisdiction with favourable tax treatment, such as Estonia (0% corporate tax on retained profits) or Lithuania (15% standard rate, with exemptions). Consulting24 advises on tax implications as part of the company setup process.
Allowed Activities Under a Passported CASP Licence
A passported MiCA CASP licence permits the following activities across all EU member states:
- Custody and administration of crypto assets on behalf of clients
- Operation of a trading platform for crypto assets
- Exchange of crypto assets for fiat currency
- Exchange of crypto assets for other crypto assets
- Execution of orders for crypto assets on behalf of clients
- Placing of crypto assets
- Receiving and transmitting orders for crypto assets
- Providing advice on crypto assets
- Portfolio management of crypto assets
However, activities not covered by MiCA-such as decentralised finance (DeFi) platforms that are truly non-custodial, or NFTs that are unique and non-fungible-may not require a CASP. Passporting also does not cover services outside the EU, such as serving US or Asian clients from an EU base.
Step-by-Step Process for Passporting
Passporting a MiCA CASP licence involves the following steps:
- Obtain a CASP licence in your chosen EU home state. This includes incorporating a company, meeting capital requirements, drafting policies, and passing regulatory review.
- Prepare passporting notification with your home regulator, including a programme of operations for each host state.
- Home regulator reviews the notification and, if satisfied, forwards it to host state regulators within 10 working days.
- Waiting period: typically 15-30 days during which host regulators may raise objections (e.g., on AML grounds).
- Begin operations in host states after the waiting period, subject to any local conditions.
- Ongoing compliance: submit annual reports to home regulator, maintain AML/CFT procedures, and respond to host regulator inquiries.
Consulting24 manages this process for clients obtaining licences in Lithuania and Estonia. For other EU jurisdictions, we coordinate with partner firms. See our application process guide for details.
Banking and Payments for Passported CASPs
One of the biggest operational challenges for passported CASPs is opening bank accounts and accessing payment services. Many EU banks remain cautious about crypto clients, even those with a MiCA licence. Passporting does not guarantee banking access; each bank makes its own risk assessment.
Firms often need to approach multiple banks or use specialised payment service providers (PSPs) that cater to crypto businesses. Some EU member states, like Lithuania, have a more developed crypto-friendly banking ecosystem. Consulting24 assists clients in securing banking relationships as part of the licence requirements package. For firms that struggle with EU banking, Panama offers a simpler banking environment with fewer restrictions.
Benefits of Passporting a MiCA CASP Licence
Passporting provides several concrete benefits:
- Single licence, multiple markets: one authorisation covers all 27 EU member states plus EEA countries (Norway, Iceland, Liechtenstein).
- Cost savings: avoids duplicate application fees, legal costs, and compliance overhead in each country.
- Regulatory consistency: a single rulebook (MiCA) applies, reducing complexity.
- Faster market entry: once licensed, passporting can be completed in a few months, compared to separate licences which could take years.
- Investor confidence: a MiCA licence is a strong signal of compliance and credibility.
For firms targeting the EU market, passporting is usually the most efficient route. However, it is not the only option. Consulting24 helps clients compare the benefits of a best country for crypto licence based on their business model.
Compliance and Trust: What Passporting Does Not Cover
Passporting does not eliminate all compliance obligations. Key areas where local rules still apply include:
- AML/CFT reporting: suspicious transaction reports must be filed with host state financial intelligence units.
- Tax registration: you may need to register for VAT or corporate income tax in host states.
- Marketing and advertising: national rules on crypto promotions (e.g., UK FCA regime, though UK is not EU) may apply.
- Data protection: GDPR compliance is required in all host states, but local data protection authorities may have specific expectations.
- Consumer protection: some states impose additional disclosure requirements.
This is general guidance, not legal advice. Firms should engage local counsel in each host state to ensure full compliance. Consulting24 provides a compliance checklist as part of our blog resources.
Common Mistakes When Passporting a MiCA CASP Licence
Even experienced firms make errors. Common pitfalls include:
- Assuming full harmonisation: believing that passporting means zero local compliance. As noted, tax and AML reporting still require local attention.
- Ignoring host state language requirements: some regulators require certain documents in the local language.
- Underestimating timeline: the CASP licence itself can take 6 months or more; passporting adds 1-2 months.
- Neglecting banking: failing to secure payment services early can delay operations.
- Choosing the wrong home state: some regulators are slower or more demanding. Lithuania and Estonia are popular for their efficiency.
Consulting24 helps clients avoid these mistakes through structured planning. For a comparison of EU jurisdictions, see our vs Lithuania page.
Alternatives to Passporting: Panama and Other Jurisdictions
Passporting is not the only route to global crypto operations. For firms that do not need EU market access, or that find EU capital and compliance costs too high, alternatives exist:
| Jurisdiction | Key Feature | Cost (approx) |
|---|---|---|
| Panama | No minimum capital, flat fee EUR 6,000, no ongoing compliance burden | EUR 6,000 |
| Dubai (VARA) | Full regulatory framework, but high costs and local presence required | From EUR 50,000+ |
| Switzerland | FINMA licence, strong reputation, but expensive and time-consuming | From EUR 100,000+ |
Panama is particularly attractive for firms seeking a low-cost, low-compliance jurisdiction. Consulting24 delivers Panama company setup directly. For other jurisdictions, we advise and coordinate. Compare Panama crypto licence with EU options.
How Consulting24 Can Help
Consulting24 (X24Consulting OU, Tallinn, Estonia) has obtained over 500 crypto licences worldwide. We deliver directly in Estonia, Lithuania, and Panama, and advise and coordinate in all other jurisdictions. Our services include:
- Licence application and passporting support
- Company formation and corporate services
- Banking and payment partner introductions
- Ongoing compliance and AML officer services
Whether you choose a MiCA CASP licence with passporting or a Panama company, we provide expert guidance. Contact us via WhatsApp or book a consultation to discuss your project.
Frequently asked questions
What does passporting a MiCA CASP licence mean?
Passporting allows a CASP licensed in one EU member state to offer services in all other EU states without separate licences. The home regulator notifies host regulators, and the firm can operate after a short waiting period.
Does passporting cover all EU countries?
Yes, passporting covers all 27 EU member states plus EEA countries (Norway, Iceland, Liechtenstein). It does not cover non-EU countries like the UK or Switzerland.
What are the capital requirements for a MiCA CASP?
Minimum capital is EUR 50,000 for basic services, EUR 125,000 for exchange services, and EUR 150,000 for complex services. These are own funds and must be maintained at all times.
How long does passporting take?
After obtaining the CASP licence (3-6 months), the passporting notification process takes 1-2 months. Total timeline from start to passporting is typically 4-8 months.
Can I passport from any EU country?
Yes, but the home state must have implemented MiCA and designated a competent authority. Some regulators are more efficient; Lithuania and Estonia are popular choices.
Does passporting exempt me from local tax?
No. Each EU state applies its own tax laws. You may need to register for corporate income tax or VAT in host states if you have a permanent establishment.
What activities are not covered by passporting?
Services outside the EU, truly decentralised finance (DeFi) without custody, and unique NFTs are not covered. Also, local AML reporting and marketing rules still apply.
Is Panama a good alternative to EU passporting?
Yes, for firms not targeting EU clients. Panama offers a flat fee of EUR 6,000, no minimum capital, and minimal ongoing compliance. It is ideal for global operations outside the EU.
Do I need a local office in host states?
Generally no, but you must have a registered office in the home state. Host states may require a local representative for AML purposes in some cases.
Can Consulting24 help with passporting?
Yes, Consulting24 delivers CASP licences in Lithuania and Estonia and manages the passporting process. For other EU jurisdictions, we coordinate with local partners.
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