GERMANY Law and Practice Contributed by: Stephan D. Meyer, Lars Fidan, Elisa Otto and Christian Meisser, LEXR
may be a security even if it looks and behaves like a typical crypto-asset. This classification is the single most consequential regulatory decision for any token project, because it determines which licences, disclo - sures and conduct rules apply downstream. 10.4 Regulation of “Issuers” of Blockchain Assets The issuer regime depends on the classification. For security tokens (financial instruments), public offer - ings exceeding the applicable thresholds require a BaFin-approved prospectus under the EU Prospec - tus Regulation. The eWpG provides the framework for issuing electronic securities, requiring entries in a crypto securities register maintained by a registered custodian. For crypto-assets under MiCA, issuers of other crypto- assets (including utility tokens) must publish a white paper and notify it to BaFin at least 20 working days before the offering. ART issuers require authorisation and must maintain reserve assets. EMT issuers need authorisation as credit institutions or e-money institu - tions. Tokenisation of real-world assets is gaining momen - tum but faces practical challenges. The eWpG cov - ers bearer bonds, fund units and electronic shares, meaning that tokenised real estate still requires more complex legal structuring. The interaction between on-chain records and off-chain legal title is not yet fully resolved, and secondary market liquidity remains limited. 10.5 Regulation of Blockchain Asset Trading Platforms Crypto-asset trading platforms need CASP authori - sation under MiCA, covering organisational require - ments, prudential standards, conflict-of-interest rules and market surveillance. Authorised platforms benefit from the EU passport. For tokenised financial instruments, trading must occur on a MiFID II venue (regulated market, MTF, or OTF) or under the DLT Pilot Regime (see 2.5 Regula- tory Sandbox ). Peer-to-peer trading is not explicitly addressed by MiCA, but platforms that effectively match orders may, depending on the concrete ser -
vices provided, be classified as operating a trading platform. As with other areas of crypto regulation, BaFin looks at what a platform actually does, not what it calls itself. 10.6 Staking The regulatory treatment of staking services in Ger - many under MiCA is still developing. MiCA does not explicitly list staking as a regulated crypto-asset ser - vice. However, depending on the specific structuring, staking services may be classified as custody and administration of crypto-assets on behalf of clients (a regulated CASP service) if the service provider holds the client’s crypto-assets and delegates them for stak - ing. BaFin has not issued definitive guidance on staking. Most providers operate under CASP custody licenc - es. Where staking involves pooling client assets with expected returns, a collective investment scheme classification under the KAGB is theoretically possible but has not been formally pursued. The classification depends on the specific operational model. 10.7 Crypto-Related Lending Crypto lending is regulated, but the applicable frame - work depends on the structure. Accepting deposits or granting credit on a commercial basis requires a KWG banking licence, regardless of whether the loans are denominated in fiat or crypto. Where a platform accepts crypto-assets as collateral, it may simulta - neously trigger MiCA custody obligations and KWG lending requirements. Peer-to-peer crypto lending models where the plat - form does not lend on its own balance sheet may fall outside the banking licence requirement but could trigger investment intermediation or crowdlending regulation. The collapse of several centralised crypto lending platforms globally has sharpened BaFin’s focus on this area, especially around client asset seg - regation and the transparency of lending terms. 10.8 Cryptocurrency Derivatives MiFID II treats cryptocurrency derivatives as financial instruments. This includes futures, options, contracts for difference (CFDs) and other derivative instruments
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