EU CryptoReg roundup: July 2026

Welcome to our EU crypto update - a roundup of key Irish and EU legislative and regulatory developments shaping the crypto-asset sector. 

This update is brought to you by our Regulatory & Risk Advisory practice group in Ireland. 

Our aim is to keep you informed of the fast-evolving legal landscape, from new legislation and guidance to significant case law and observations. Sign up here to receive the next update in your inbox.

The "key dates" section highlights key legislative and reporting dates relevant to Irish CASPs. 

Key developments this month include:

• MiCAR’s transitional period ended on 1 July 2026; CASPs must be authorised under MiCAR to continue providing crypto-asset services in the EU.
• The European Parliament adopted its position on the digital euro package, enabling trilogue negotiations on the proposed Digital Euro Regulation to begin. 
• ESMA launched a supervisory review of CASPs’ operational resilience, focusing on custody services and key risks under MiCAR and DORA.

Legislation and guidance

Europe

EU expands sanctions targeting Russian crypto-assets

23 July 2026 – the Council of the EU adopted its 21st package of restrictive measures against Russia.

• The EU has extended its transaction ban to 14 crypto-related service platforms based in Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan and Belarus.
  
  
• The measures also introduce the possibility for a full third-country ban on crypto-asset services, aimed at deterring jurisdictions from hosting platforms which are used to circumvent EU sanctions. This would allow the EU to prohibit transactions between EU operators and crypto providers used by Russia.
  
  
• The package further extends the prohibition on Russian and Belarusian nationals owning, controlling or serving on the board of EU companies providing crypto-asset services.

European Parliament agrees negotiating position on the digital euro

2 July 2026 – the European Parliament adopted its position on the Single Currency Package, which includes proposals to establish a digital euro.

• The European Parliament, Council of the European Union and European Commission will now begin negotiations on the final legislation. The first round of talks with the Irish Presidency of the Council, representing member states, is expected to take place shortly.

Other updates

Ireland 

CBI issues warning to consumers holding crypto-assets with unauthorised CASPs

1 July 2026 – following the end of the MiCAR transitional period, the Central Bank of Ireland (CBI) has issued a notice to consumers who hold crypto-assets with unauthorised Crypto-Asset Service Providers (CASPs). 

• The notice warns that customers whose crypto-assets are held with unlicenced CASPs do not benefit from MiCAR safeguards and protections.
  
  
• The CBI advises such consumers to check the ESMA Register to verify whether their provider is authorised under MiCAR. If not, customers must transfer their crypto-assets to an authorised CASP or a self-hosted wallet in order to avail of MiCAR protections.

CBI Financial Crime Bulletin

22 July 2026 – the CBI published the second edition of its Financial Crime Bulletin, including discussion of money laundering and terrorist financing risks linked to crypto-assets.

• The bulletin identifies AML/CFT as a continuing supervisory priority for the crypto-asset sector, citing evolving typologies, rapid onboarding, complex cross-border flows and fragmented KYC and transaction monitoring.
  
  
• The bulletin discusses the National Risk Assessment (NRA), published in June 2026, which assigned CASPs a Very Significant risk profile. It notes that rapid sector growth, including decentralised finance and privacy-enhancing technologies, complicates the detection of money laundering and terrorist financing risks.
  
  
• The bulletin also confirms that AML REQ submission dates will be standardised from 2027, with annual returns due each March based on the previous year's data.

Europe

ECB progress report on the Digital Euro rulebook

7 July 2026 – the European Central Bank (ECB) has published its sixth progress report on the work of the digital euro scheme's Rulebook Development Group.

• The report confirms that following market consultation, the ECB has published a revised version of the interim draft rulebook (version 0.91), incorporating feedback from stakeholders. The final version of the rulebook will be completed following adoption of the Digital Euro Regulation.

ESMA launches Common Supervisory Action on CASPs' digital operational resilience 

8 July 2026 – The European Securities and Markets Authority (ESMA) launched a Common Supervisory Action (CSA) on the digital operational resilience of CASPs, with a particular focus on custody services.

• The CSA will assess the maturity of CASPs' digital operational resilience frameworks for custody activities. It will focus on risks inherent to distributed ledger technology (DLT) including governance, key and storage management, transaction controls, incident detection and response, smart contract risk and reliance on third-party providers.
  
  
• National Competent Authorities (NCAs) will conduct the exercise on a risk-based sample of authorised CASPs between the second half of 2026 and the first half of 2027.
  
  
• Findings from the NCAs will be consolidated into a final report for submission to ESMA's Board of Supervisors in the second half of 2027.

ESRB Annual Report 2025

13 July 2026 – the European Systemic Risk Board (ESRB) published its 2025 annual report, summarising its activities during the year.

• The report highlights regulatory concerns relating to crypto-assets and decentralised finance, particularly the growth of the global stablecoin market. It notes that crypto markets remain volatile, as illustrated by the October 2025 market crash.
  
  
• The report also refers to the ESRB's September 2025 Recommendation on third-country multi-issuer stablecoin schemes, which recommended that such schemes should not be permitted under MiCAR or, if allowed, should be subject to appropriate safeguards. The ESRB notes that these schemes could increase financial stability risks and create significant vulnerabilities for the EU.

ECB selects PSPs to join digital euro pilot

14 July 2026 – the ECB has announced that it has selected 36 payment service providers (PSPs) from across the EU to participate in the digital euro pilot. The 12-month pilot, due to begin in the second half of 2027, will support preparatory work for the possible issuance of a digital euro.

• Distributing PSPs will provide Eurosystem staff with access to beta digital euro services, including opening beta digital euro accounts and making payments. Acquiring PSPs will support selected merchants in receiving beta digital euro payments. Some providers will act as both distributors and acquirers.
  
  
• The pilot will involve staff from the ECB and participating national central banks, who will be able to make beta digital euro payments on a person-to-person and person-to-business basis.
  
  
• The ECB has updated its digital euro pilot FAQs to reflect these developments.

Speeches

17 July 2026 – Piero Cipollone, member of the Executive Board of the ECB, delivered a speech titled 'The cooperative spirit at the heart of the digital euro'.

• Mr Cipollone reiterated that the digital euro is intended to safeguard Europe’s monetary sovereignty and reduce dependence on non-European payment providers. He also noted that it will make it easier for banks to innovate and roll out new services at scale. 
  
  
• He noted that the European Parliament voted in favour of its negotiating position on the digital euro in July 2026, allowing trilogue negotiations to commence.