MiCA and the flawed premise of centralised supervision : operational burden vs. supervisory consistency

Abstract

This article critically analyses a leaked European Commission proposal to shift the supervision of Crypto-Asset Service Providers (CASPs) from National Competent Authorities (NCAs) to centralised control under the European Securities and Markets Authority (ESMA). The paper argues that this move, presented as a technical adjustment, is a scale-shifting constitutional change that fundamentally undermines the careful balance of the original Markets in Crypto-Assets Regulation (MiCA), which relied on NCA supervision and ESMA coordination. The critique concludes that centralised supervision is legally questionable, structurally incoherent, and operationally harmful, risking excessive bureaucracy, the erosion of national expertise, and a direct contravention of the principle of subsidiarity. The paper concludes by advancing a reinforced model for supervisory convergence and cooperation as a superior alternative.