The Institute of International Finance (IIF) has publicly responded to the European Securities and Markets Authority’s (ESMA’s) consultation on ESMA's proposed guidelines on the reverse solicitation exemption under Article 61 of the Markets in Crypto-Assets Regulation (MiCA).

The response advocates for a measured, technology-neutral approach to regulating crypto-assets that does not unduly restrict the ability of regulated financial institutions to engage in these activities. It emphasizes the importance of establishing a formal equivalence regime for crypto-asset services, particularly between major financial jurisdictions, and cautions against treating equivalently regulated firms in third countries as wholly unregulated. While providing adequate consumer protection, the response argues that local authorities should bear in mind the risk of effectively requiring local customers – and CASPs that service them – to use less liquid local venues. 

The response also takes issue with several specific aspects of ESMA's proposed guidelines, including the broad interpretation of solicitation that encompasses all brand advertising, the strong indication of solicitation based on having a website in an EU language other than a language of international commerce, and the suggestion that the reverse solicitation exemption can only be used for a very short period despite MiCA Article 61(1) implying it can apply to ongoing client relationships.