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Crypto asset surveillance: MiCA compliance and best practices

In this article, we outline the MiCA regulation, key dates, surveillance challenges, and how firms can build a reliable monitoring programme.

Published 2025-09-04
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Crypto market abuse moves fast, and MiCA raises the bar in 2025. In this article, we outline the regulation, key dates, surveillance challenges, and how firms can build a reliable, explainable monitoring programme that meets the standard.

Why crypto surveillance can't wait until the deadline

Crypto markets operate 24/7, across borders, and with a mix of regulated and unregulated venues. This combination creates fertile ground for market abuse and significant challenges for compliance teams.

With the EU’s Markets in Crypto-Assets Regulation (MiCA) taking full effect in 2025, regulators will expect more than detection. Firms must be able to explain and document every alert, showing exactly how decisions were made. 

What is MiCA?

MiCA is the European Union’s first detailed framework for crypto assets. It introduces new rules for transparency, licensing, and market abuse prevention for crypto-. The regulation aligns with principles from MAR and MiFID II but adds crypto-specific obligations, especially for stablecoins and asset-referenced tokens.

Timeline

  • June 2024 – Rules take effect for asset-referenced and e-money tokens
  • December 2024 – Finalisation of technical standards for market abuse detection
  • September 2025 – Deadline for CASP authorisation in most EU countries (including Sweden)

The surveillance challenges of crypto markets

Crypto surveillance is not like monitoring traditional financial markets. Firms must navigate several unique challenges:

  • No market close – Trading happens around the clock, every day
  • Fragmented platforms – Including centralised exchanges (CEXs), decentralised exchanges (DEXs), OTC trades, and peer-to-peer systems
  • Anonymity tools – Wallet addresses may not link to verified identities
  • Multi-step transactions – DeFi protocols and cross-chain swaps can hide the origin or purpose of trades
  • Market links – Crypto prices can affect derivatives, ETFs, and even fiat FX pairs

Crypto is different from other financial instruments due to the 27/4/365 trading, which means that there are no opening or closing hours for trading. 

- Per Friberg, Senior Financial Crime Surveillance Officer at Trapets

Patterns of abuse in crypto

Firms must watch for both traditional market abuse tactics and crypto-native schemes:

  • Wash trading – Artificially inflating volume or token rankings
  • Pump-and-dump schemes – Often organised via social media or messaging apps
  • Front-running – Using mempool data to jump ahead of pending trades
  • Flash loans – Manipulating token prices via smart contract exploits
  • NFT price distortion – Repeated trades between connected wallets to influence price floors

In a transaction, crypto assets can be both a payment and a transfer of the asset itself. Therefore, the market surveillance teams and transaction monitoring teams will need to collaborate to monitor crypto assets effectively. 

- Per Friberg, Senior Financial Crime Surveillance Officer at Trapets

Building an effective crypto surveillance framework

The most resilient MiCA-compliant programmes share these characteristics:

  1. Unified data collection: Integrate blockchain analytics with CEX and DEX market data, enriched by KYC/PEP profiles (see KYC Guide and PEP & RCA Guide).
  2. Hybrid detection models: Combine rules for known MAR-style abuse with AI models to identify emerging crypto-specific risks.
  3. Explainability and audit trails: Provide clear justifications for every alert, including wallet link analysis and transaction graphs.
  4. Integrated escalation workflows: Connect market abuse alerts with AML investigations when suspicious trading is tied to illicit fund flows.
  5. Continuous calibration: Retrain models with new DeFi exploits, NFT market trends, and regulatory enforcement examples.

As Joe Biddle, UK Market Director at Trapets, notes: 

“AI may be trained on outdated patterns, so teams need the ability to question and override its decisions.”

Looking ahead: MiCA and global convergence

Based on what we've seen on the market, the next phase of regulation may extend to NFTs, algorithmic stablecoins, and more complex DeFi protocols. 

APAC regulators are watching closely, and the US is exploring frameworks for stablecoin oversight.

Firms that build flexible, multi-asset surveillance today will adapt faster when regulatory boundaries shift tomorrow.