ESMA’s New MiCA Guidelines Aim to Professionalize Crypto Advice and Information Across the EU

The rollout of the Markets in Crypto-Assets Regulation (MiCA) across the European Union has introduced a sweeping transformation for crypto-asset service providers (CASPs) and investors alike. At the heart of this regulatory evolution lies a detailed set of guidelines released by the European Securities and Markets Authority (ESMA) in July 2025, establishing mandatory standards for assessing knowledge and competence among individuals who provide advice or information related to crypto-assets or crypto-asset services.

These guidelines do more than add a new compliance layer. They are designed to bridge persistent gaps in investor protection, align professional standards across EU jurisdictions, and provide consistency in supervisory practices for a sector known for its volatility, innovation, and uneven expertise. ESMA made its objective unmistakable: those interacting directly with clients—whether offering advice or simply providing information—must now demonstrate a thoroughly evaluated level of knowledge and competence that reflects the unique dynamics and risks of crypto-assets.

MiCA emerged amid increasing retail involvement in digital asset markets and growing calls from policymakers and regulators for stronger investor safeguards. ESMA’s new rules are central to that mission, focusing on areas of heightened risk and information imbalance in the fast-evolving crypto space.

Article 81 of the MiCA regulation sets the baseline, requiring CASPs to ensure any person giving advice or information about crypto-assets has appropriate knowledge and skills. ESMA’s guidance expands this mandate to include anyone providing client-facing information—whether via digital channels, automated platforms, or direct communication.

To define “knowledge and competence,” the guidelines lay out a comprehensive, layered framework. Staff are expected to have a core understanding of the technical features, operational processes, and specific risks of crypto-asset services. This includes a working knowledge of distributed ledger technology, protocol characteristics, and the transaction-level implications of these systems. ESMA also underlined the need for risk awareness, highlighting the importance of grasping issues like price volatility, cyber threats, system flaws, private key custody, and the complexity of cross-chain transfers.

In terms of market functionality, the guidelines require familiarity with crypto market structures, the role of large stakeholders in affecting price and liquidity, and how these differ from traditional markets—particularly with respect to investor protections. Compliance literacy is also vital. Staff must understand anti-money laundering rules, market abuse regulations, and data reporting obligations. Moreover, they should be able to distinguish MiCA’s investor protection mechanisms from those under MiFID II.

The goal is not just to ensure that clients receive correct information but to empower staff to communicate the inherent risks and nuances of crypto-assets clearly and effectively.

Another major innovation in the ESMA guidelines is the formalization of minimum training, experience, and ongoing education requirements. For those providing information about crypto-assets, staff must complete at least 80 hours of professional instruction and gain six months of supervised experience—or alternatively, have one year of relevant supervised experience. Advisers face even steeper requirements, with multiple pathways depending on educational background. These include a tertiary degree plus a year of experience, a three-year secondary education combined with experience, 160 hours of focused training plus experience, or two years of MiFID II/IDD experience paired with six months in crypto.

Pre-existing qualifications can count, provided they sufficiently cover the content described by the ESMA framework. For staff already in advisory or information roles when the guidelines take effect, competence may be recognized based on one year of continuous activity. Nonetheless, the guidelines emphasize ongoing reassessment. ESMA recommends continuous professional development (CPD), with a minimum of 10 hours annually for information providers and 20 hours for advisers. These numbers may vary depending on the complexity of the services provided.

Crucially, ESMA encourages the use of both internal and external tools to verify learning outcomes, allowing competent authorities to publish lists of recognized education providers. This flexibility, however, has sparked debate. Stakeholder groups such as the Securities and Markets Stakeholder Group (SMSG) have called for mandatory external verification to avoid conflicts of interest and maintain consistent standards EU-wide.

A key principle underpinning the guidelines is proportionality. Not all CASPs deal with the same types of products or risk levels. The rules are adaptable based on service complexity, product risk, and communication channels. In cases where information is delivered through automated or semi-automated systems, the knowledge criteria apply to those responsible for setting or overseeing the algorithms, ensuring clients are not exposed to misleading or incomplete advice.

The guidelines also place a duty on CASP management bodies to review and update their competence policies at least once a year, addressing deficiencies and ensuring regulatory and technological developments are accounted for. A six-month transition period will follow the publication of the guidelines in all official EU languages, allowing firms time to adjust.

While the guidelines currently permit both internal and external assessments of staff knowledge, further standardization may be introduced as the regulatory framework evolves and the market matures. ESMA stresses that these requirements supplement, rather than replace, existing frameworks like MiFID II. The aim is to build an additional layer of protection tailored specifically to the characteristics and challenges of the crypto industry.

Ultimately, the purpose of the knowledge and competence guidelines is to raise the standard of professional engagement in crypto markets and enhance investor confidence. For investors, the benefit lies in better quality information and a reduced risk of being misled or misinformed. For CASPs, the framework offers a way to reduce conduct risks and build trust while streamlining cross-border operations by aligning regulatory expectations. Regulators benefit from greater supervisory efficiency and convergence, and the industry as a whole stands to gain from a more credible and stable foundation for innovation and long-term growth.

Yet, challenges remain. The risk-based nature of crypto-assets demands that the rules remain flexible and not unduly burdensome for CASPs with simpler offerings. There is also a continuing need for transparency and independent oversight of education providers to prevent fragmentation and ensure high standards.

ESMA’s MiCA knowledge and competence framework marks a crucial step in embedding a culture of professionalism in European crypto markets. It moves beyond box-ticking compliance to demand genuine skill, ongoing development, and accountability. As implementation begins, the success of this initiative will be measured not just in audits or enforcement activity, but in the confidence of retail investors and the evolving reputation of crypto as a legitimate, responsibly managed component of the financial system.

With MiCA’s broader regulatory rollout ongoing, the knowledge and competence rules offer a key benchmark—one that may soon influence regulatory thinking well beyond Europe.

By fLEXI tEAM