Belgian regulator reviews crypto asset classifications pending harmonization

The Belgian Financial Services and Markets Authority has created a table to differentiate between crypto asset securities, investment instruments and financial instruments.

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The Financial Services and Markets Authority (FSMA), the Belgian regulator, invites comments on its communication on the classification of crypto assets as securities, investment instruments or financial instruments. Intended for issuers, suppliers and service providers, the agency's communication will serve as a guide to the existing ordinance until the European harmonization of the regulations.

The communication is intended to answer frequently asked questions and is not exhaustive. It comes with a step-by-step chart to help readers determine an item's classification.

Crypto assets that are embedded in an instrument, as is generally the case with exchangeable or fungible assets, may be classified as transferable securities under the Prospectus Regulation of the European Union (EU) or as investment instruments under the EU Prospectus Law. In these cases, the rules of conduct of MiFID (Markets in Financial Instruments Directive) apply.

If an asset has no issuer, as in the case of Bitcoin (BTC) or Ether (ETH), where the instruments are created by computer code that does not give rise to a legal relationship , then in principle the Prospectus Regulation, the Prospectus Law and the MiFID rules do not apply. When the European Union Regulation on Crypto Asset Markets (MiCA) comes into force, trading platforms will be required to publish white papers for issuerless tokens.