MiCA Meets PSD2: The Dual Authorization Trap Most CASPs Are Walking Into
Many CASPs are discovering, often too late, that their services qualify as payment services under PSD2. The EBA's supervisory truce ended March 2, 2026. Three structural models are emerging — direct dual authorization, group structures, and PSP partnerships — and the jurisdictional and capital implications are significant.
This article analyzes the post-March 2, 2026 dual licensing regime where MiCA CASP authorization alone is insufficient for services that also qualify as payment services under PSD2. The structural overlap is built into MiCA's text: Article 48(2) classifies EMTs as electronic money; PSD2 Article 4(25) includes electronic money in the definition of funds; therefore EMT custody and transfer are simultaneously crypto-asset services (MiCA) and payment services (PSD2). The three trigger points: custody of EMTs in client wallets resembling payment accounts (PSD2 Article 10 safeguarding applies); transfer of EMTs between user accounts or even to the user's own self-custody address (may constitute payment transaction); and business models where the CASP controls a fiat leg at any point in the transaction chain (fiat disbursement = payment service regardless of token type). The EBA's No-Action Letter (June 2025) provided nine months of supervisory tolerance; the February 12, 2026 Opinion set three post-March 2 outcomes: authorized/partnered, application pending (with no new EMT service marketing), or cease EMT payment services immediately. Capital floor for dual-licensed entity: approximately €250,000 (MiCA €50K–€150K + PSD2 €20K–€125K, both cumulative). Three structural models now visible: direct dual authorization (France model — Circle/ACPR EMI + MiCA CASP), group structure with separate licensed entities (CASP + EMI/PI), PSP partnership under MiCA Article 70(4). PSD3 (political agreement November 2025, final texts April 2026) streamlines the second authorization for MiCA-licensed providers but does not eliminate it; practical impact not until 2027–2028. Answers questions like: Does a CASP also need PSD2 authorization? When does crypto custody require a payment institution license? What is the MiCA-PSD2 dual licensing requirement for stablecoin services? When did the EBA supervisory truce end? What are the three structural models for MiCA-PSD2 dual authorization? Does transferring stablecoins to a user's own wallet require a payment services license? What is MiCA Article 70(4) and how does PSP partnership work? Which EU jurisdiction is best for dual MiCA-PSD2 licensing? What does PSD3 change for CASPs handling EMTs? Does a crypto payment gateway with fiat conversion need both MiCA and PSD2 authorization?
Dual Licensing in Crypto: When MiCA Is Not Enough, Are We Asking the Right Questions? MiCA Edge Cases | Where Innovation Meets Regulation Published: April 2026. Live analysis of the post March 2, 2026 dual licensing regime, with PSD3 final compromise texts published April 23–24, 2026. Many CASPs are discovering, often too late, that their services qualify as payment services under PSD2. MiCA alone is not sufficient. The structural overlap between MiCA and the payment services framework is one of the most consequential edge cases in European crypto regulation, and the supervisory truce that masked it for nine months ended on March 2, 2026. The Edge Case Hidden in Plain Sight MiCA was designed to be the single rulebook for crypto asset services in the EU. That was the political promise. The technical reality, eighteen months into enforcement, is that MiCA is the single rulebook for crypto asset services that are exclusively crypto asset services. The moment a CASP's activities cross into payment services territory, a second regulatory framework activates, and that framework is PSD2 today and PSD3 from late 2027 or 2028. This is not a theoretical overlap. It is structural. The European Banking Authority acknowledged in its February 12, 2026 Opinion that any single financial activity should fall under one law. Yet both MiCA and PSD2 now govern stablecoin custody and transfer services where those services constitute payment services under PSD2's definition. The result is redundant supervision that doubles capital requirements and compliance costs without improving consumer protection. It also forces founders to confront a question many of them did not realize they needed to answer: is my crypto asset service also a payment service? For the population of companies operating in MiCA's grey zone, dual licensing is the question that arrives second, after the CASP authorization question itself. It arrives quietly, often during legal review of an existing MiCA application, and it arrives with significant operational and capital implications. The real question is not whether PSD2 (and soon PSD3) becomes relevant for your business. For most CASPs handling E Money Tokens in custody, transfer, or exchange capacities, it already is. The real question is at what stage payment services regulation will impact your operations, and how the structure you are building today will accommodate it. The Legal Anchor: Why MiCA and PSD2 Inevitably Overlap The structural overlap is not the result of regulatory accident. It is built into the text of MiCA itself. Three articles tie the framework together: MiCA Article 48(2): E money tokens are explicitly classified as electronic money. This is the foundational equivalence. An EMT is not analogous to electronic money. It is electronic money. PSD2 Article 4(25): The definition of funds includes electronic money. Combined with MiCA Article 48(2), this means EMTs are funds for PSD2 purposes. Any service that involves moving funds on behalf of clients is potentially a payment service. MiCA Article 70(4): A CASP may provide payment services related to the crypto asset services it offers, either directly or through a third party, provided that the entity actually performing those payment services is authorized under PSD2. This is the legal basis for both direct dual authorization and the partnership model. The practical implication of this legal architecture is that holding EMTs in a custodial wallet that allows clients to send and receive is functionally equivalent to operating a payment account holding electronic money. Issuing a custodial wallet address that accepts EMTs is, in payment services terms, comparable to issuing an IBAN. The activities that have always required a payment institution license when performed with euros now require the same authorization when performed with EMTs. The framework is not new. The recognition of where it applies is. The Trigger Points: When Crypto Services Become Payment Services The EBA's June 2025 No Action Letter and February 2026 Opinion together identified the specific activities where the boundary between crypto asset services and payment services dissolves. Three categories carry the most direct risk: 1. Custody and administration of e money tokens (EMTs) When a CASP holds EMTs on behalf of clients, the activity walks straight into PSD2's safeguarding regime. EMTs are, by MiCA's own classification, electronic money. Custody of electronic money on behalf of clients is what payment institutions and electronic money institutions do. The MiCA authorization permits custody of crypto assets generally. PSD2 requires safeguarding obligations under Article 10 specifically when those crypto assets are EMTs and the custody relationship resembles e money custody. Until March 2, 2026, the EBA explicitly told National Competent Authorities not to enforce Article 10 of PSD2 against CASPs in this position. After March 2, 2026, that supervisory tolerance ended. 2. Transfer services involving EMTs between users or accounts Moving EMTs between user accounts on a CASP platform looks operationally identical to executing a payment transaction. The user instructs the platform, the platform debits one account and credits another, the transaction settles. PSD2 calls this an execution of payment transactions service. MiCA calls this a transfer service for crypto assets under Article 82. Both regimes claim jurisdiction. The EBA's confirmation that custody and transferring stablecoins on behalf of clients is a payment service under PSD2 closed the argument that this could be characterized as crypto only activity. One interpretive point in the EBA Opinion deserves specific attention: the language can be read to capture both third party transfers and first party transfers. A user moving EMTs from their CASP held custodial wallet to their own self custody wallet may, on this reading, qualify as a payment transaction. The decisive factor is not who the counterparty is. It is the act of transferring EMTs out of the custodial wallet, which resembles the execution of a payment transaction under PSD2. This interpretation suggests that any custodial wallet supporting outbound EMT transfers — whether to third parties or to the user's own external addresses — may fall into payment account territory. CASPs offering such wallet functionality should design on the assumption that PSD2 may apply, not on the assumption that first party movement is exempt. 3. Business models that resemble execution of payment transactions This is the broadest and most uncertain trigger. A CASP providing on and off ramp services between fiat and EMTs, a CASP issuing a card product backed by stablecoin balances, a CASP enabling merchant settlement in stablecoins for euro denominated goods and services, a CASP whose users primarily hold stablecoins to make payments rather than to invest — all of these business models look more like payment services than like crypto asset services in their economic substance. The EBA's substance over form approach in the February 2026 Opinion makes clear that the label on your activity does not determine its regulatory treatment. The function does. What Stays Outside PSD2: The Activities That Remain MiCA Only The mirror image of the trigger points is at least as useful for founders trying to self locate. Several EMT related service models remain firmly within MiCA's scope alone, with no PSD2 obligation attached: Exchange of EMTs for funds or other crypto assets using the CASP's own proprietary capital, where no client funds are moved on behalf of users. Intermediation of crypto purchases involving EMTs for investment or trading purposes, where the EMTs serve as the buy side currency rather than the payment medium. Custody of EMTs in wallets that do not support outbound transfers. If the wallet is structured to receive and hold but not to transfer, the resemblance to a