Crypto.com has secured a key regulatory license under the European Union’s Markets in Financial Instruments Directive (MiFID), granting it legal authority to offer cryptocurrency-based derivatives across the European Economic Area (EEA). The move positions the exchange to compete in Europe’s fast-evolving crypto derivatives market, as major players - including Kraken and Coinbase - race to secure licenses under overlapping European financial regulations.
The MiFID license follows earlier acquisition of regulatory approval under the EU’s Markets in Crypto-Assets Regulation (MiCA), highlighting the dual-licensing strategies crypto firms now deploy to meet complex European compliance standards.
The license, granted via Cyprus's financial regulator CySEC, allows company to offer financial instruments that include crypto futures and options - products that are increasingly in demand among both retail and institutional clients in the region. The company obtained the license through its acquisition of Cyprus-based trading services firm A.N. Allnew Investments, a common pathway for crypto firms navigating the EU’s fragmented regulatory architecture.
Unlike the single-licensing approach in some global jurisdictions, entry into the European crypto market often requires parallel compliance with multiple frameworks - primarily MiCA, which focuses on crypto asset issuance and service provision, and MiFID II, which governs more complex financial instruments, including derivatives.
MiFID license grants it access to a broader category of crypto financial products, beyond simple spot trading or custody services. While the MiCA regime offers a pan-European passport for crypto services like wallet provision, stablecoin issuance, and exchange operations, it does not automatically permit the offering of derivative instruments. That gap must be filled by separate MiFID licensing - typically reserved for traditional finance firms offering securities, futures, and options.
The convergence of these two frameworks is reshaping how crypto exchanges structure their operations in Europe. By obtaining both MiCA and MiFID credentials, the compnay now joins a small but growing group of firms preparing to offer fully regulated crypto derivatives across the EU.
Cyprus Emerges as a Regulatory Gateway
The use of Cyprus as a licensing base is part of a broader trend. Several crypto exchanges, including Kraken and Gemini, have either registered entities or completed acquisitions in Cyprus to obtain MiFID status through local regulatory engagement.
In this case, the firm secured approval for its acquisition of A.N. Allnew Investments from the Cyprus Securities and Exchange Commission (CySEC), a regulatory body that has become one of the most crypto-engaged within the EU. Cyprus’s regulatory environment has proved favorable for firms looking to obtain both MiFID and MiCA-related permissions, especially those interested in offering leveraged products and complex trading strategies.
Kraken followed a similar route. On May 20, the U.S.-based exchange announced it had launched regulated crypto derivatives trading in Europe via its MiFID II-regulated Cyprus-based entity, Payward Europe Digital Solutions. The launch came just days after Kraken completed the acquisition of U.S. futures trading platform NinjaTrader, and reported a 19% year-on-year increase in quarterly revenue.
This Cyprus-centric licensing strategy reflects how EU member states - while bound by bloc-wide regulations - retain some discretion in interpreting and enforcing financial rules. For global exchanges, this creates both opportunity and complexity as they navigate multi-jurisdictional compliance.
Why Crypto Derivatives Are Gaining Regulatory Focus
The surge in regulatory approvals for crypto derivatives follows rising global demand for such products. Derivatives - contracts whose value is derived from the price of an underlying asset like Bitcoin or Ethereum - now account for over 70% of total crypto trading volume globally, according to recent data from CCData (formerly CryptoCompare). Institutional traders often prefer derivatives for hedging, arbitrage, and speculative leverage.
However, crypto derivatives have long existed in a gray area in many jurisdictions, including the EU. The introduction of MiCA and the reinforced application of MiFID II aim to bring this activity into the regulatory perimeter, particularly following repeated episodes of market instability - including the collapse of leveraged products during the 2022 crypto downturn.
Exchanges that wish to offer regulated futures or options products to EU residents must now obtain MiFID licensing, a higher regulatory standard than MiCA. This involves capital requirements, investor protections, transaction reporting obligations, and restrictions on leverage.
Coinbase, Gemini, Synthetix Also Targeting Derivatives Growth
Recent move is not occurring in isolation. A string of other exchanges and platforms have recently escalated their derivatives exposure through acquisitions and license expansions.
Earlier in May, Coinbase confirmed it would acquire Deribit, one of the world’s largest crypto options and futures platforms by volume. The deal signals Coinbase’s intent to increase its footprint in derivatives markets - especially those operating outside the U.S., where regulatory clarity remains elusive.
Meanwhile, Gemini has secured EU regulatory approval to expand its own crypto derivatives services. Decentralized finance (DeFi) platforms are also pushing into the space: Synthetix, one of Ethereum’s earliest synthetic asset protocols, is planning to re-acquire Derive, a crypto options platform it helped incubate.
This rising wave of activity underscores the growing competitiveness of the global derivatives sector. Exchanges not participating in this vertical risk losing out on high-volume, high-margin trading activities increasingly sought by institutional players.
Acquisition Trail and Derivatives Ambitions
The company has signaled its intentions in this area for some time, and it has been steadily assembling a portfolio of financial and brokerage entities globally, laying the groundwork for a broader derivatives strategy.
Among its past acquisitions are:
- Fintek Securities – Expanding U.S. market access
- Charterprime – A multi-asset brokerage operating in Asia-Pacific
- Orion Principals – A Cayman-based fund and trading firm
- Watchdog Capital – A U.S. SEC-registered broker-dealer
These acquisitions reflect a pivot toward regulated financial service infrastructure that can support advanced products like derivatives, margin lending, and structured instruments.
With MiFID authorization now secured, the firm can begin rolling out crypto derivatives across Europe within a fully licensed environment. However, actual product launches and local market rollouts will likely be staggered and depend on national-level regulatory alignment within the EEA.
What MiFID Licensing Actually Entails
MiFID II, implemented across the EU in 2018, was designed to enhance transparency and consumer protection in traditional financial markets. For crypto platforms, MiFID compliance means adhering to:
- Robust capital adequacy requirements
- Segregation of client funds
- Pre- and post-trade transparency
- Reporting obligations to national regulators
- KYC/AML controls aligned with EU directives
Offering crypto derivatives under MiFID requires not only technology infrastructure but also legal, compliance, and risk management frameworks that mirror those of legacy finance firms.
This stands in contrast to the largely unregulated derivatives markets that have historically operated in offshore jurisdictions. For example, platforms like Binance and Bybit have long dominated the crypto derivatives space but have faced regulatory pushback for offering products to European or U.S. users without proper licensing.
By entering the European market under MiFID, the company may be able to attract users who have been blocked or restricted on non-compliant platforms - while also reducing legal risk.
Strategic Timing Amid Shifting U.S. Regulatory Landscape
The pivot to Europe also comes as the United States continues to deliver mixed signals on crypto derivatives. While the CFTC has granted some limited approvals, and CME offers regulated crypto futures, platforms like FTX and Binance have faced enforcement action for offering derivatives without proper oversight.
In a separate development, reports emerged that the U.S. Commodity Futures Trading Commission (CFTC) may launch investigation over marketing and sponsorship practices linked to the Super Bowl, though details remain limited. The company's growing emphasis on regulated markets like Europe may represent both a business expansion and a defensive diversification away from U.S. uncertainty.
Final thoughts
With MiCA set to be fully enforced by the end of 2025, and MiFID II continuing to underpin financial services regulation, the EU is positioning itself as one of the most comprehensive regulatory environments for crypto firms.
By obtaining both MiCA and MiFID licenses, crypto firms are building infrastructure to survive and compete in this new landscape. But the challenge ahead is not just regulatory - it is also commercial. Offering regulated derivatives must come with education, onboarding strategies, and robust platform tools to compete with the informal but dominant derivatives venues that currently operate offshore.
As the market matures, those able to meet both compliance requirements and user expectations will likely shape the next phase of crypto’s integration with global financial markets.