This edition of our "MiCAR under the microscope" series analyses the comparison between the obligation to draw up a white paper under MiCAR and a prospectus under Regulation (EU) 2017/1129 of the European Parliament and of the Council of June 14, 2017 (the “Prospectus Regulation”) with special emphasis on (i) the scope of application, (ii) the instruments that are captured, (iii) the applicable exemptions, (iv) the relevant authority with supervisory powers, (v) the content, (vi) the potential liability of the issuer in connection with the content of the offering documents, and (vii) the obligation to change or supplement the offering document.

Scope of application

MiCAR requires the drawing up of a white paper when EMT, ART, or Other Crypto-Assets are offered to the public or intended to be admitted to trading (“White Paper”). A White Paper is an information document containing general information on the issuer, offeror, or person seeking admission to trading; on the project to be carried out with the capital raised; on the rights and obligations attached to the crypto-assets; on the underlying technology used for such crypto-assets; and on the related risks.

It is important to understand the two scenarios where a White Paper is required, which are essentially the offer to the public and the admission to trading. These two concepts derive from the Prospectus Regulation.

1. Offer to the public: According to Article 3.1(12) MiCAR, “offer to the public” means a “communication to persons in any form, and by any means, presenting sufficient information on the terms of the offer and the crypto-assets to be offered so as to enable prospective holders to decide whether to purchase those crypto-assets.”¹
2. Admission to trading: MiCAR does not expressly define the concept of “admission to trading,” but the obligation to draw up the White Paper is triggered when the crypto-assets are intended to be admitted to trading on a trading platform for crypto-assets within the European Union. Article 3.1(18) MiCAR defines “trading platform” as “a multilateral system, which brings together or facilitates the bringing together of multiple third-party purchasing and selling interests in crypto-assets, in the system and in accordance with its rules, in a way that results in a contract, either by exchanging crypto-assets for funds or by the exchange of crypto-assets for other crypto-assets.”²

The scope of application with respect to the obligation to draw up a White Paper under MiCAR is similar to the scope of application of the Prospectus Regulation. Both legal regimes require the publication of a prospectus in case of offer to the public or admission to trading of products.

Instruments

The Prospectus Regulation applies to financial instruments as identified under Directive 2014/65/EU (“Financial Instruments”) of the European Parliament and of the Council of May 15, 2014 on markets in financial instruments (“MiFID II”), regardless of the method or instrument by which they are represented (bearer form, book entries, or distributed ledger technology (DLT)), while MiCAR applies to crypto-assets that do not qualify as financial instruments (“Crypto-Assets”).

Crypto-Assets include a wide range of tokens such as utility tokens, certain stablecoins, and other digital assets that are not structured as investment products or do not confer rights similar to shares, bonds, or derivatives.

The ESMA Final Report dated December 17, 2024³ provides further clarity on the distinction between security tokens (which may fall under MiFID II) and other tokens that are instead regulated under MiCAR. According to ESMA, the key factors in determining whether a crypto-asset is a Financial Instrument include the rights attached to the token, its transferability, and its economic function. Security tokens typically represent ownership or claims similar to traditional Financial Instruments, such as shares or bonds, and therefore fall within the MiFID II regime. In contrast, tokens that do not confer such rights—such as those used solely for accessing a service or as a means of exchange—are generally not considered Financial Instruments and are instead subject to MiCAR.

The analysis of whether a particular token is a Financial Instrument should be made on a case-by-case basis, taking into account the different features of the token. If the conclusion is that the token is considered a Financial Instrument, a prospectus will have to be drafted following the provisions of the Prospectus Regulation.

Exemptions

For the purposes of this section, we compare the key public offer exemptions set out under the Prospectus Regulation⁴ and the public offer exemptions for Other Crypto-Assets set out under MiCAR.⁵ Please see the table showing the comparison of the key relevant exemptions below.⁶

Approval/notification requirement

MiCAR White Paper

MiCAR does not require the prior approval of the White Paper by the relevant competent authority for Other Crypto-Assets⁷ and e-money tokens. However, the White Paper has to be notified to the relevant competent authority, but the publication can proceed without waiting for formal approval. Asset-referenced tokens’ White Papers are subject to prior administrative approvals.

1. Notification timeline: The White Paper must be submitted to the competent authority at least 20 working days before its intended publication.
2. Content of notification: The submission must include the White Paper and an explanation as to why the Crypto-Asset is not a security token, an ART, or an EMT, and a list of all EU countries where the offer or admission to trading is intended.
3. Publication: The White Paper must be published on the issuer's website and remain accessible for as long as the tokens are held by the public.

Prospectus Regulation

The prospectus must be submitted to the national competent authority in the issuer's home member state for approval before publication. The offer or admission to trading cannot proceed until the national competent authority has formally approved the prospectus.

1. Approval timeline: The national competent authority must review and decide on the approval of the draft prospectus within ten working days of submission (or 20 working days for first-time issuers). If the issuer has a Universal Registration Document, the approval period may be reduced to five working days.
2. Content of submission: The submission must include the complete draft prospectus, which must contain all material information necessary for investors to make an informed assessment of the issuer and the Financial Instruments. This includes details on assets, liabilities, financial position, prospects, rights attached to the Financial Instruments, and the reasons for the offer or admission to trading.
3. Notification (passporting): Once approved, the issuer may request the national competent authority to notify the prospectus to the competent authorities of other EU member states where the offer or admission to trading is intended. The national competent authority will send a certificate of approval and the prospectus to the host authorities, usually within one working day.
4. Publication: The approved prospectus must be published—typically on the issuer's website (or in the relevant regulated market where the Financial Instruments are listed)—and remain accessible for as long as the Financial Instruments are held by the public or admitted to trading.

National competent authority

MiCAR White Paper

Taking into account that ART and EMT are envisaged to be issued by credit institutions, while Other Crypto-Assets can be issued by any type of natural or legal person, MiCAR allows EU member states to designate the competent authorities responsible for carrying out the functions and duties set out under MiCAR. Where member states designate more than one competent authority, they have to determine their respective tasks and designate one competent authority as the single point of contact for cross-border administrative cooperation between competent authorities as well as with the EBA and ESMA.⁸

For example, in Spain, the competent authority supervising ART and EMT is the Bank of Spain, as they are issued by credit institutions, while the competent authority supervising Other Crypto-Assets is the stock market supervisor (la Comisión Nacional del Mercado de Valores).

ESMA has published on its website a list of the competent authorities so the relevant stakeholders can see who the competent authorities are.⁹

Prospectus Regulation

As described in the “Scope of application” section above, the scope of the Prospectus Regulation encompasses both the offer to the public and the admission to trading on a regulated market of Financial Instruments. Consequently, the competent authority responsible for oversight is the stock market supervisor. Unlike the framework established under MiCAR, there is not a system of multiple competent authorities; instead, a single supervisory body is designated for these purposes.

ESMA has published on its website a list of the competent authorities so the relevant stakeholders can see who the competent authorities are.¹⁰

Disclosure requirements, format, and content

MiCAR White Paper

MiCAR sets out the prescribed content of the white paper under Article 6 of MiCAR (for Other Crypto-Assets) and further detailed in Annex 1. The focus is on providing clear and concise information about:

• the issuer of the Crypto-Asset
• the Crypto-Asset itself
• the underlying technology
• associated risks
• rights attached to the Crypto-Asset
• details of the offer.

Prospectus Regulation

The format and content are strictly regulated, with specific requirements set out in the Prospectus Regulation and further elaborated in Delegated Regulation (EU) 2019/980. The aim is to ensure maximum transparency and investor protection, resulting in a much more extensive and formalized disclosure document.

• Comprehensive details about the issuer
• Full information on the Financial Instruments being offered
• Audited financial statements
• Detailed risk factors
• Complete terms and conditions of the offer

The MiCAR requirements are generally less detailed and less standardized compared to those under the Prospectus Regulation. The format allows for some flexibility, aiming to ensure that information is understandable and accessible to potential investors, but without the extensive formalities of a full prospectus.

Please see below a summary with the key differences between the White Paper for Other Crypto-Assets and the prospectus for Financial Instruments.

Liability for content of White Paper/prospectus

Both MiCAR and the Prospectus Regulation establish liability regimes concerning the content of the prospectus and the White Paper. However, there are important differences in their approaches. The liability regime under MiCAR is directly applicable across all member states, meaning that it does not require further implementation or adaptation at the national level. In contrast, the Prospectus Regulation mandates that member states develop their own national liability regimes, albeit within the framework of certain guidelines and instructions provided by the regulation itself. This distinction highlights MiCAR’s uniform approach, as opposed to the more decentralized and flexible approach adopted by the Prospectus Regulation.

Liable entities or persons

Under both sets of regulations, liability extends to the issuer, the offeror, any person seeking admission of the asset to trading, as well as the members of their administrative, management, or supervisory bodies. In addition, the MiCAR broadens the scope of liability to include operators of trading platforms. This is particularly relevant where the obligation to prepare a White Paper arises because the trading platform itself has sought the admission of a Crypto-Asset to trading. In such cases, the operator of the trading platform assumes responsibility alongside the other liable parties.

Causes of liability

Under MiCAR, responsibility arises when the Crypto-Asset White Paper is incomplete, unfair, unclear, or misleading. In such cases, it is incumbent upon the holder of the Crypto-Asset to provide evidence demonstrating that the information required under MiCAR was not complete, fair, or clear, or was misleading. Furthermore, the holder must show that reliance on this deficient information influenced their decision to purchase, sell, or exchange the Crypto-Asset.

In contrast, under the Prospectus Regulation, responsibility is triggered when the information contained in the prospectus does not correspond to the facts, or when the prospectus contains omissions that are likely to affect its significance with respect to the issuer. Member states have further elaborated on the circumstances under which liability is triggered through their national laws. For instance, in Spain, national legislation specifies that liability arises for any damages or losses suffered by holders of securities acquired as a result of false information or omissions of relevant data in the prospectus.

Obligation to modify the White Paper

Article 12 MiCAR addresses the obligation to supplement or amend the Crypto-Asset White Paper in the event of significant new factors, material mistakes, or inaccuracies that could affect the assessment of the Crypto-Assets being offered to the public or admitted to trading. Please see below some key points to be considered for the modification regime of the White Paper of Other Crypto-Assets.¹¹

1. Obligation to update: If, after the publication of a Crypto-Asset White Paper and before the end of the offer to the public or admission to trading, a significant new factor, material mistake, or inaccuracy arises, the offeror or person seeking admission to trading must prepare a modification to the White Paper.¹²
2. Notification: The modification must be notified to the competent authority including the reasons for such modification at least seven working days before their publication.¹³
3. Publication: The publication of the modified Crypto-Asset White Paper have to be published on the website of the issuer, offeror, or person seeking admission to trading in the same manner as the original publication.
4. Withdrawal rights: MiCAR sets out a general withdrawal regime for retail investors of a period of 14 calendar days within where such investors can withdraw from the obligation to purchase Other Crypto-Assets since the execution of the agreement to purchase those crypto-assets. However, MiCAR does not set out a particular withdrawal regime where there is a modification in the Crypto-Asset White Paper during a public offer similar to the one set out under the Prospectus Regulation.¹⁴

Footnotes

1. Article 2(d) Prospectus Regulation defines “offer of securities to the public” as a “communication to persons in any form and by any means, presenting sufficient information on the terms of the offer and the securities to be offered, so as to enable an investor to decide to purchase or subscribe for those securities. This definition also applies to the placing of securities through financial intermediaries.”

2. The Prospectus Regulation does not define the concept of admission to trading. The obligation to draw up a prospectus is triggered when the Financial Instruments are intended to be admitted to trading in a regulated market situated in the EU. The Prospectus Regulation narrows the scope of application to regulated markets (as defined under MiFID II) and excludes other types of trading venues, such as MTFs and OTFs.

3. ESMA35-1872330276-1899

4. Article 1.4 Prospectus Regulation.

5. Please note that ART and EMT set out other exemptions in MiCAR (Article 16.2 MiCAR for ART and 48.4 MiCAR for EMT). Moreover, also for Other Crypto-Assets other exemptions may apply that we have not described. The exemptions for Other Crypto-Assets are listed under 4.2 and 4.3 MiCAR.

6. For the purposes of this paper, we have summarized the most relevant exemptions under the Prospectus Regulation. There are other exemptions under the Prospectus Regulation that relate to Financial Instruments (e.g., merger exemption, public take over exemption, etc.)

7. Please note that Article 18 MiCAR requires the prior approval of the relevant competent authority not only of the white paper but also of the ART.

8. Please see Article 93 MiCAR.

9. Please see the list of competent authorities per member states.

10. Please see the list of competent authorities per member states.

11. Please note that the supplement or modification regime is different for ART and EMT. In this respect, please refer to Article 25 MiCAR for the modification regime.

12. Article 23 of the Prospectus Regulation sets out similar obligation, in particular “every significant new factor, material mistake or material inaccuracy relating to the information included in a prospectus which may affect the assessment of the securities and which arises or is noted between the time when the prospectus is approved and the closing of the offer period or the time when trading on a regulated market begins, whichever occurs later, shall be mentioned in a supplement to the prospectus without undue delay.”

13. In the case of a prospectus, the supplement must be approved (not notification) by the competent authority and published in the same way as the original prospectus. In this respect, please refer to the “Approval/notification requirement” section above.

14. According to Article 23 Prospectus Regulation, investors who have already agreed to purchase or subscribe to the Financial Instruments before the supplement is published have the right to withdraw their acceptance within three working days after the publication of the supplement, if the new information is significant for their investment decision.