Cryptocurrency platform Kanga announced on June 25 that it had received a MiCA Type 3 license from the Bank of Latvia on June 18, authorizing it to provide crypto asset custody, trading, and digital asset transfer services in all EEA member states through the European Economic Area (EEA) "passport" mechanism, without the need to apply separately to each member state.
Authorized Services and Compliance Requirements for MiCA Type 3 License
The Type 3 license is one of the most comprehensive authorization categories under the MiCA framework, applicable to platforms that simultaneously provide crypto asset trading and customer fund custody services. The authorized services obtained by Kanga include: crypto asset custody, crypto asset trading, and digital asset transfer.
Compliance requirements for obtaining such a license include: corporate governance structure, customer asset protection mechanisms, anti-money laundering (AML) measures, cybersecurity standards, and operational risk management systems. After obtaining the license, Kanga will continue to be supervised by the Bank of Latvia in accordance with uniform European standards.
Timing Background for Choosing Latvia: Poland's Legislative Progress and the July 1 Deadline
Kanga's Latvian license was issued on June 18, 13 days before the July 1 transition deadline. Poland's legislative process for the full implementation of MiCA was still ongoing during Kanga's application period; through the Latvian license, Kanga can provide services to the entire EU market without waiting for Poland's local regulations to be finalized.
In recent months, Latvia has become a popular regulatory jurisdiction for crypto companies seeking rapid access to the European single market due to its centralized licensing system, and this is not a case-specific choice of Kanga.
Frequently Asked Questions
How does the MiCA passport mechanism work, and which regions can Kanga serve through this mechanism?
The MiCA passport mechanism allows crypto asset service providers licensed in any EEA member state to offer services to clients in all EEA member states without the need to apply separately to other member states. Kanga's Latvian license grants it the qualification to provide licensed services in all 30 EEA member states (including the 27 EU countries plus Norway, Iceland, and Liechtenstein).
What is the difference between the MiCA Type 3 license and other categories?
MiCA divides licenses into multiple categories, with Type 3 being one of the most comprehensive authorizations, specifically designed for platforms that simultaneously provide crypto asset trading and customer fund custody services. Its compliance requirements are also the most stringent, covering multiple aspects such as corporate governance, customer protection, AML, cybersecurity, and risk management.
What situation will unlicensed crypto asset service providers face after the July 1 deadline?
July 1 is the termination date of the EU's MiCA transitional arrangements. After this date, institutions providing crypto asset services to clients within the EU must hold a MiCA license to operate legally; the operational qualifications relying on the current transitional systems of each member state will no longer apply after this date.
