MiCA adopts a functional and risk-based classification framework. The regulatory analysis begins by determining whether a crypto-asset falls within one of MiCA’s two enhanced regulatory categories:
asset-referenced tokens (ARTs) or
e-money tokens (EMTs). ARTs are characterised by mechanisms intended to stabilise their value through reference to one or more assets, while EMTs are designed to function as digital representations of fiat currency. Where a crypto-asset does not exhibit stabilisation mechanisms, does not reference external assets or fiat currency, and is not intended to operate as a means of payment, it falls outside these regimes.
Crypto-assets that are neither ARTs nor EMTs are classified as “
other crypto-assets” under MiCA. This residual category captures tokens whose value is not stabilised and whose purpose is not monetary in nature, regardless of whether they are transferable or traded on secondary markets. Once a crypto-asset is classified as an “other crypto-asset,” the regulatory focus shifts to its functional and economic role, most commonly to determine whether it operates as a utility token for the purposes of Title II.
In assessing whether an “other crypto-asset” functions as a utility token, the key question is whether it is designed to provide access to features, functions, or services within a defined digital ecosystem. In practice, this may include tokens that enable users to access digital services, unlock platform features, purchase in-platform goods, or participate in reward, loyalty, or incentive mechanisms. Such tokens derive their economic relevance primarily from their functional use within an ecosystem, rather than from their capacity to act as a store of value or investment instrument.
A further important consideration is the absence of characteristics typically associated with investment or monetary tokens. Utility tokens do not seek to maintain a stable value, do not promise redemption at par, and do not represent claims on underlying assets or currencies. Their market value may fluctuate, but this fluctuation is incidental to their core purpose rather than a defining feature of their design.
The fact that a utility token may be transferable or traded on secondary markets does not, in itself, alter its regulatory classification. MiCA expressly recognises that tokens designed for functional use may circulate beyond their platform of origin without losing their essential character. The decisive factor remains the issuer’s design intention and the token’s primary purpose, rather than the existence of external liquidity.
This functional approach is supported by MiCA’s recital 18, which draws a clear distinction between tokens intended to function as access rights within a system and those designed to operate as investment instruments, means of payment, or value-stabilised assets. Even where technically transferable, crypto-assets whose value and relevance stem from enabling participation in a digital ecosystem may fall within the utility-token concept as regulated under MiCA’s “other crypto-asset” framework.
About the Author
This article has been authored by
Jeremy Mifsud Bonnici, Advisor - Legal.
