Only a few months after the full implementation of Europe Markets in Crypto-Assets (MiCA) regulation, the holes in the EU-wide common policy of cryptos are starting to show. Regulatory arbitrage is no more: whether it is the ad clampdown by Google or a licensing race, startups are now having to choose between speed and scale.
Micro‑States, Mega Influence
MiCA promised harmonization, but its early impact reveals something else: small EU regulators setting the rules for the whole bloc. In recent weeks:
- Malta approved major players like Crypto.com and OKX, with Gemini next in line.
- Luxembourg is expected to finalize Coinbase’s EU entry in Q3.
- In the meantime, Germany and France are stagnating authorizations and demanding more inspections.
This is not just paperwork. MiCA will allow a license obtained by a Crypto-Asset Service Provider (CASP) to enter the 27 EU nations in a single Member State because one license will cover the entire EU. This means even a small regulator, regardless of staffing or speed, could unlock the entire European market.
Google Pulls the Trigger
The tipping point came on 23 April 2025, when Google banned crypto ads in the EU unless the advertiser held a valid MiCA licence. No licence, no visibility. And since Google needs pan-EU and local certification, crypto startups not covered by the regulation at all are not even admitted to the largest digital channel in the EU part of the continent.
The End of Paid Search
Paid search used to be the most inexpensive means of testing demand in various EU markets without the need to open offices in early-stage ventures. That playbook is now dead. With Google tying campaigns to licence status, ad budgets are now constrained by the slowest regulator—whether that’s in Berlin, Brussels, or Paris.
Some are shifting focus to fast‑track regulators like Malta and Estonia, and others are waiting.
Educational platforms dealing with crypto, including CryptoManiaks, are making startups more familiar with the crypto environment, and can be used to help make decisions on regional licensing and go-to-market approaches with transitions in compliance requirements.
Venture Funding: Up, But Targeted
MiCA hasn’t killed crypto VC—but it’s changing its shape. Europe-based fintechs and Web3 firms are still attracting capital, especially those leaning into stablecoin rails, DeFi compliance tools, or tokenized assets.
- OpenTrade raised $7M this spring for its yield-as-a-service platform for stablecoin treasuries.
- Ramp Network and Keyrock continue to scale with strong MiCA compliance postures.
- Funds like Notion Capital and Speedinvest are selectively backing teams building inside the regulatory perimeter.
However, VCs are more reserved all around. Numerous people want evidence of licensing before they decide to jump in. The other option is opting to start up in those jurisdictions that have optimized MiCA jurisdictions.
ESMA: The Centralizer-in-Waiting
The European Securities and Markets Authority (ESMA) is already reviewing a report on the way national authorities are enforcing MiCA, and whether it is having a positive effect. As one of the consequences, there is a suggestion to endow ESMA with the veto privileges regarding future CASP licenses that may be too soft.
That would mirror how the ECB now oversees systemic eurozone banks and could reduce Malta or Estonia’s leverage in setting market-wide rules. But any centralization effort is likely to face stiff resistance from member states guarding regulatory autonomy.
Who’s Racing Ahead—and Who’s Stuck?
Winners
- Malta, Estonia, and Lithuania: Fast approvals, streamlined CASP pipelines
- VC-backed fintechs with early legal budgets and cross‑border plans
- Marketing agencies specializing in regulatory-certified ad flows.
Losers
- Small-to-mid exchanges without legal firepower or political leverage
- DeFi projects caught in limbo between innovation and regulatory classification.
- Early-stage builders dependent on paid search for user testing.
Conclusion
- By end-2025, over 70% of crypto service providers will likely fail to obtain CASP licenses, shutting out thousands of operators from the EU.
- Google’s enforcement makes compliance urgent—not optional—for any company with marketing ambitions in Europe.
- Pan-EU regulatory arbitrage will continue until ESMA or the Commission steps in to unify enforcement.
For now, Malta may be the unlikely gatekeeper of crypto’s European future. But if Brussels reasserts control, today’s fast lanes may turn into detours.
