Issuers of Electronic Money Tokens (‘EMTs’)

Electronic Money Tokens (EMTs) are defined under the Markets in Crypto-Assets Regulation (MiCA) as a type of crypto-asset that purports to maintain a stable value by being denominated in a single official currency of an EU Member State. EMTs are designed to function as a digital representation of fiat currency and are intended primarily as a means of payment.

MiCA aligns the issuance and management of EMTs with the EU’s existing e-money framework (Directive 2009/110/EC), requiring EMT issuers to be either credit institutions or authorised electronic money institutions (EMIs).

Regulatory Requirements for EMT Issuers

Overview of MiCA Provisions Specific to EMT Issuers

Under the Markets in Crypto-Assets Regulation (MiCA), Electronic Money Token (EMT) issuers are subject to a regulatory framework aligned with EU e-money rules, with additional obligations tailored to the digital nature of EMTs. Issuers must be authorised as either:

• A credit institution (bank), or
  
• An electronic money institution (EMI) under the E-Money Directive (2009/110/EC).
  

Key MiCA provisions include strict requirements for governance, transparency, reserve backing, and user rights, with enhanced scrutiny applied to significant EMTs (those with large market reach).

Capital Adequacy and Safeguarding Requirements

• Own Funds: EMT issuers must maintain minimum capital requirements — either €350,000 or 2% of the average value of EMTs in circulation, whichever is higher.
  
  
• Safeguarding of Funds: Issuers are obliged to segregate user funds by either:
  
  • Holding them in separate accounts at credit institutions, or
    
  • Investing them in low-risk, liquid assets (e.g. government bonds).
    
    
• Reserve Assets: The value of the reserve must match the full amount of EMTs issued at all times, ensuring 1:1 backing with the referenced fiat currency.
  

Obligations Regarding Redemption and Issuance Policies

• Right of Redemption: EMT holders have the unconditional right to redeem tokens at par value (i.e. face value in fiat currency) at any time, free of charge or with minimal costs.
  
  
• Redemption Process: Issuers must implement clear, accessible procedures for redemption and disclose them publicly.
  
  
• Issuance Limits & Transparency: Issuers must maintain full transparency on the amount of EMTs in circulation and provide regular reporting to both users and competent authorities.
  
  
• White Paper Requirement: A detailed EMT white paper must be published and notified to the competent authority prior to public offering or admission to trading.

Benefits of Issuing Electronic Money Tokens

• Increased Market Trust Through Regulatory Compliance
  Issuing EMTs under MiCA provides firms with a strong reputational advantage. Full regulatory compliance signals operational integrity, financial soundness, and consumer protection — increasing user confidence and stakeholder trust. The MiCA framework aligns EMTs with established financial sector standards, distinguishing them from unregulated or offshore stablecoins.
• Improved Access to EU-Wide Investor Networks
  MiCA introduces passporting rights, allowing authorised EMT issuers to operate across all EU Member States without needing separate licences. This facilitates rapid scaling and pan-European market access, giving issuers the ability to tap into a broader consumer and business base, including fintechs, merchants, and platforms seeking compliant stable digital payment solutions.
• Enhanced Credibility and Transparency in Financial Transactions
  EMTs offer real-time digital payment capabilities with full reserve asset backing and auditability, making them attractive for B2B settlements, merchant integrations, and DeFi platforms requiring fiat-equivalent tokens. Transparency obligations under MiCA — including public white papers, regular disclosures, and redemption guarantees — boost legitimacy and user adoption.
• Strategic Business Growth Opportunities Under Clear Legal Frameworks
  Operating within a harmonised and clearly defined regulatory framework reduces legal uncertainty and regulatory risk, encouraging long-term investment, innovation, and partnerships. EMTs can serve as building blocks for more complex financial products (e.g. tokenized deposits, programmable money) and enable synergies across payments, remittances, and embedded finance sectors.

EMT Licence Application Process under MiCA

Eligibility Requirements and Initial Assessment
To issue Electronic Money Tokens (EMTs) under MiCA, an applicant must either:

• Be a credit institution, or
  
  
• Obtain authorisation as an Electronic Money Institution (EMI) under the E-Money Directive (2009/110/EC), subject to MiCA-specific obligations.
  

National Competent Authorities (NCAs) will conduct a preliminary assessment of the applicant’s legal form, management structure, and financial soundness before proceeding to a full review.

Essential Documentation for Application Submission
Applicants must submit a robust set of materials to demonstrate readiness and compliance. Core elements include:

• Comprehensive Business Plan and Operational Model:
  Detailing the EMT’s purpose, token economics, issuance model, redemption mechanisms, and intended markets.
  
  
• Governance, Risk Management, and Compliance Frameworks:
  Including internal control systems, AML/CFT policies, IT infrastructure, outsourcing arrangements, and procedures for safeguarding user funds.
  
  
• Evidence of Sufficient Financial Resources:
  Applicants must show initial capital of at least €350,000 or 2% of average EMT holdings, as well as liquidity forecasts, audited financials, and reserve management plans.
  
  
• White Paper Notification:
  A white paper describing the EMT, its functionality, risks, and redemption rights must be submitted to the NCA and published prior to issuance.
  

Application Timeline, Key Stages, and Regulatory Interactions

• Stage 1 – Pre-filing Engagement (Optional):
  Informal discussions with the regulator to clarify expectations and align on submission scope.
  
  
• Stage 2 – Submission of Application:
  Full application package submitted to the NCA.
  
  
• Stage 3 – Assessment Period:
  Regulators conduct a formal review of the application.
  Requests for clarifications or additional information may be issued during this stage.
  
  
• Stage 4 – Authorisation Decision:
  If approved, the applicant receives formal authorisation and may proceed to issue EMTs under MiCA rules across the EU via passporting.
  
  

Annual Fees and Ongoing Regulatory Obligations

How CSB Group Can Assist Your EMT Licence Application

At CSB Group, we provide end-to-end support for your Electronic Money Token (EMT) licence application under MiCA. Our team of regulatory and legal experts will guide you through eligibility assessments, prepare and review your full application pack — including the business plan, governance framework, and white paper — and liaise directly with the relevant Competent Authority on your behalf. We ensure your application is strategically structured, technically compliant, and aligned with the latest regulatory expectations to maximise approval success and accelerate market entry within the EU.