Why MiCA does not apply
The Markets in Crypto-Assets Regulation does not apply to crypto-assets that qualify as financial instruments under MiFID II. Section C of Annex I to MiFID II lists the financial instruments, and points 4 to 10 cover derivatives: options, futures, swaps, forwards and other derivative contracts on a wide range of underlyings, financial contracts for differences, and, at point 10, other derivative contracts relating to assets, rights, obligations, indices and measures not otherwise mentioned which have the characteristics of other derivative financial instruments. A contract that gives exposure to the price of a crypto-asset falls within these categories.
ESMA's guidelines on the qualification of crypto-assets as financial instruments, published on 19 March 2025, direct competent authorities to align their approach to crypto-asset underlyings with points 4 to 10 of Section C. They state that perpetual futures should be treated as derivative contracts despite having no expiry date, and that settlement in cash or in crypto-assets does not in itself change a product's characteristics. A product's commercial name is irrelevant: a perpetual contract, a leveraged token or a contract described as spot but settled by reference to price movements is assessed on what it does.
Authorisation in the EU
A firm that provides investment services in relation to crypto derivatives needs authorisation as an investment firm under MiFID II for each service it provides. A broker that passes clients' orders to another firm provides reception and transmission of orders; one that executes them provides execution of orders on behalf of clients; and one that takes the other side of its clients' positions deals on its own account. A firm that operates a venue on which third parties trade derivatives with each other needs authorisation to operate a multilateral or organised trading facility.
The initial capital follows the services. Under the Investment Firms Directive, a firm authorised to deal on own account or to underwrite or place on a firm commitment basis must hold EUR 750 000; a firm that only receives and transmits or executes orders, manages portfolios, gives advice or places without a firm commitment, and may not hold client money or securities, must hold EUR 75 000; and other firms, including operators of a multilateral trading facility, must hold EUR 150 000, rising to EUR 750 000 for an operator of an organised trading facility that deals or may deal on own account. The competent authority must inform the applicant within six months of a complete application whether authorisation has been granted, and the authorisation can then be passported across the EU.
The product rules matter as much as the authorisation. On 24 February 2026 ESMA stated that perpetual futures offering leveraged exposure to crypto-assets are likely to fall within the national product intervention measures on contracts for differences, which for retail clients limit leverage on crypto-assets to 2:1 and require margin close-out, negative balance protection and a standardised risk warning. Our note on perpetual futures and the EU rules on CFDs sets these out. A firm serving retail clients must also meet MiFID II's appropriateness and product governance requirements.
Combining spot and derivatives
A firm that offers both spot crypto-assets and crypto derivatives carries on activities under two regimes. One route is to hold two authorisations, a CASP authorisation for the spot services and an investment firm authorisation for the derivatives, in the same entity or in separate group entities with shared governance and systems. The other starts from the investment firm. MiCA allows an authorised investment firm to provide crypto-asset services equivalent to the investment services for which it is authorised by notifying its home competent authority at least 40 working days before it begins, with the information the Regulation prescribes, rather than applying for a separate CASP authorisation. For a firm whose main business is derivatives, the second route is often the more efficient, but it covers only the crypto-asset services that correspond to its existing investment permissions.
Authorisation in the UK
In the UK, cryptoasset derivatives such as contracts for differences, futures and options are specified investments under the existing regulated activities legislation, so dealing in them, arranging deals in them and the other investment activities require permission under Part 4A of the Financial Services and Markets Act 2000. The new cryptoasset regime due to come into force on 25 October 2027 covers qualifying cryptoassets themselves and does not change this. The FCA's prudential rules set the permanent minimum capital by permission: £750,000 for a firm with permission to deal on own account, £150,000 for a firm that operates a multilateral trading facility or holds client money or assets, and £75,000 for a firm limited to reception and transmission, execution, portfolio management, advice or placing without a firm commitment.
Since 6 January 2021, the FCA's rules have prohibited firms from selling, distributing or marketing cryptoasset derivatives to retail clients in or from the UK, and the prohibition extends to communicating or approving financial promotions for them. On 8 October 2025 the FCA opened retail access to cryptoasset exchange traded notes admitted to trading on a UK recognised investment exchange, and it stated that its ban on retail access to cryptoasset derivatives would remain in place. A UK firm offering crypto derivatives can therefore serve professional clients and eligible counterparties only, and its client categorisation must be robust enough to withstand the FCA's scrutiny.
What the application covers
An application for an investment firm offering crypto derivatives is assessed on the same basis as any other: a coherent business model, capital and liquidity adequate for the risks, governance and management that are fit and proper, and systems and controls appropriate to the business. The points that receive particular attention are the pricing and hedging of positions where the firm deals on own account, the margin and liquidation methodology, the custody of client assets used as collateral, the controls against market abuse, the categorisation and appropriateness assessment of clients and, in the EU, the application of the CFD measures to retail clients. The anti-money laundering framework must address the particular risks of crypto-asset deposits and withdrawals.
How we can help
We prepare investment firm and trading venue applications for firms offering crypto derivatives and perpetual futures in the EU and the UK, and advise on combining them with CASP authorisation. See investment firm and MTF authorisation and MiCA CASP authorisation, or speak to us. Our note on licensing a crypto on-ramp covers the spot side.
Sources
- Directive 2014/65/EU (MiFID II), Article 7 and Annex I, Sections A and C, and Directive (EU) 2019/2034 (Investment Firms Directive), Article 9, as published on EUR-Lex
- Regulation (EU) 2023/1114 on markets in crypto-assets, Articles 2(4) and 60, as published on EUR-Lex
- ESMA, Guidelines on the conditions and criteria for the qualification of crypto-assets as financial instruments, 19 March 2025
- FCA Handbook, COBS 22.6 (prohibition on the retail marketing, distribution and sale of cryptoasset derivatives) and MIFIDPRU 4.4 (permanent minimum capital requirement)
- Financial Conduct Authority, FCA bans the sale of crypto-derivatives to retail consumers, 6 October 2020, and FCA opens retail access to crypto ETNs, 1 August 2025
Checked 17 October 2026.