This should be in the MiCA whitepaper

MiCA goes into effect a year from now. For asset-referenced tokens, this means new whitepaper requirements.

De Markets in Crypto Assets Regulation (MiCA), which becomes lawful in the European Union as of June 30, 2024, requires a white paper to be prepared when asset-referenced tokens are offered to the public or admitted to trading on a trading venue.

We look at the white paper requirements for asset-referenced tokens. Such a token is defined as a crypto value that is not an e-money token and whose value must be maintained by reference to another value or right or a combination thereof, including one or more official currencies. In this context, in principle, issuers can only be credit institutions or legal entities licensed under MiCA.

Content requirements for an MiCA whitepaper for asset referenced tokens

The content requirements for a whitepaper for asset-referenced tokens are basically very similar to the content requirements for the whitepaper for crypto-assets other than e-money tokens and asset-referenced tokens supplemented by specific requirements for asset-referenced tokens. The whitepaper must first contain information about the issuer. In particular, this information includes key company details (e.g., legal form, address, company number) and accurate information about the issuer's financial performance over the past three years, provided the issuer has been in existence for that long.

Since issuers generally need to be licensed or be a credit institution, information about the competent supervisory authorities should be included. Next, information on the token to which assets are linked must be included, such as the characteristics of the token and precise information on all natural or legal persons involved in the operation of the token. Specific information about the referenced token's public offering or admission to trading must also be included. This information includes, for example, the total number of tokens or the time limits of the offer.

Another section of the white paper should present the rights and obligations associated with the asset-referenced token, as well as information about the technology underlying the tokens. In particular, the rights and obligations associated with the tokens section should include a detailed description of the holders' claim against the issuer with respect to the assets associated with the tokens.

Include a separate section on asset coverage in the MiCA whitepaper

The white paper for asset-linked tokens should include a separate section on the asset reserve. The asset reserve is the basket of reserve funds used to guarantee the claim against the issuer. The purpose of the reserve is to ensure that the claims of asset referenced token holders do not go anywhere and that the associated assets are also available.

Accordingly, the issuer should include information on the composition of the asset-referenced token, as well as a detailed description of the mechanism for matching the value of the asset-referenced token to the receivables, including legal and technical aspects, in the MiCA whitepaper. The specific mechanisms for issuing and redeeming asset-referenced tokens should also be described in the white paper. If the issuer has invested any part of the reserve funds, it should provide information on this and describe the investment policy for the reserve funds.