Implementation of the EU Markets in Crypto-Assets Regulation in Bulgaria
Since 30 December 2024, the Markets in Crypto-Assets Regulation (“MiCA”) has been fully effective in the European Union. MiCA introduces a pan-European financial services licensing and supervisory regime for issuers of crypto assets and crypto platforms and crypto asset service providers (“CASPs”) in relation to a wide range of crypto assets, including exchange tokens (like bitcoin or ether), utility tokens and asset-referenced tokens.
MiCA implementation law in Bulgaria
Being an EU regulation, MiCA applies directly throughout the EU (including Bulgaria) with priority over domestic laws, without any national implementing legislation being required. However, MiCA leaves certain measures to the discretion of the Member States (e.g., designation of a national competent authority, length of grandfathering period for CASPs). In Bulgaria, such matters are addressed in the Bulgarian Markets in Crypto Assets Act (the “Act”) promulgated in State Gazette on 4 July 2025, which serves as an adaptation act to MiCA. Noteworthy, regarding the substantial regulatory framework of the crypto industry, the Act refers to MiCA (including definitions of key terms, regulation of public offerings and admission to trading, licensing and passporting, conduct rules of crypto-asset services, prohibition of market manipulation and insider trading).
Competent authority
The Act appoints the Financial Supervision Commission (the Bulgarian non-banking financial regulator) as the competent authority for licensing and supervision for asset-referenced tokens issuers and CASPs. The Bulgarian National Bank will license and supervise electronic money tokens issuers pursuant to the Bulgarian Payment Services and Payment Systems Act.
Grandfathering
According to the Act, virtual-asset service providers ("VASPs") that were recorded in the Bulgarian National Revenue Agency AML register:
· before 30 December 2024, may pursue in Bulgaria the activity for which they are registered until 1 July 2026 (or until they are granted or are refused a CASP license, whichever is earlier);
· between 30 December 2024 and 8 July 2025 (the date on which the Act enters into force), within three months following 8 July must apply for a CASP license and become compliant with MICA and the Act.
The Act does not provide for simplified licensing procedure for grandfathered VASPs.
Enforcement of MiCA
The fines for non-compliance with MiCA (set out in MiCA and reinstated in the Act) could be in certain cases particularly high in the light of the local standard of living: generally, up to the higher of BGN 5 million or 6.25 % of global annual turnover for a first offence and up to the higher of BGN 10 million or 12.5 % for a repeated breach.
In order to ensure compliance with MiCA, the Act and the applicable secondary legislation the regulators are empowered to impose compulsory measures such as suspension for up to 30 business days or permanent prohibition of a crypto-asset service, suspension or revocation of licenses, management prohibition and dismissals for individuals involved in the violation (potentially up to 10 years), suspensions or permanent prohibitions of public offer or the trading of certain crypto-assets on a platform, restrictions on personal trading activities.
Comment
Local VASPs will have to prepare themselves for transition from a practically unregulated environment to, in relative terms, a considerable degree of regulation and supervision. In particular, as the regulatory requirements under MiCA are substantial, registered VASPs should proceed swiftly with the preparation of their applications to the Financial Supervision Commission to be licensed as CASPs.
How Can Stoeva Tchompalov & Znepolski Help?
We have experience in guiding applicants through licensing procedures before the Bulgarian Financial Supervision Commission and in helping clients to comply with their legal obligations, once licensed. If you are considering applying for a license as a CASP in Bulgaria, please contact us for further information as to how we can help.