Nexo has announced full regulatory compliance across the European Economic Area following the implementation of the Markets in Crypto-Assets Regulation. The digital assets platform has structured its European operations through partnerships with two MiCAR-licensed entities rather than pursuing direct authorisation, splitting custody and execution functions across separate regulated infrastructure providers.
Under this arrangement, Tangany delivers institutional custody services for digital assets under its MiCAR licence, while DLT Finance handles brokerage infrastructure authorised under both MiCAR and MiFID II frameworks. This dual-partner model allows Nexo to maintain its client-facing platform while outsourcing the regulated activities to locally licensed entities within the EEA.
The approach represents a strategic response to Europe’s new crypto regulatory baseline, enabling established platforms to continue servicing European clients without directly holding MiCAR permissions. By leveraging third-party licensed infrastructure, Nexo maintains market access while delegating regulatory burden and compliance obligations to specialised partners already holding the requisite authorisations.
For crypto platforms and digital asset businesses, this partnership structure offers an alternative to lengthy direct licensing processes. However, it requires careful contractual arrangements and ongoing oversight responsibilities, as the customer-facing entity remains exposed to regulatory expectations around due diligence over third-party service providers.
MiCAR introduces comprehensive prudential, conduct, and operational requirements that have prompted consolidation among European crypto service providers and forced many to reconsider their operational structures within the bloc.
FXnCO Insight
The licensed-partner model may accelerate market entry across MiCAR jurisdictions, but firms must ensure robust governance frameworks address outsourcing risks and maintain clear accountability for client outcomes.
Source: Finance Magnates