MSB: First Distinguish Between the United States and Canada
MSB registration with the U.S. FinCEN primarily falls within the federal anti-money laundering framework. FinCEN expressly states that registration is not an operating license, nor is it an endorsement of a business's legality; state-level and other requirements must still be verified. Canada's FINTRAC likewise has an MSB and foreign MSB registration regime, and states that provincial or territorial qualifications cannot substitute for federal registration. The names in the two countries are similar, but the definitions of services, applicable nexus and obligations are not entirely the same. One cannot assume that purchasing an "MSB certificate" means one can serve all of North America.
VASP: A Category Name, Not an International Certificate
The FATF uses the concept of VASP to describe entities that, on a commercial basis, provide services to others such as virtual asset exchange, transfer and custody. The FATF sets international anti-money laundering standards, but it does not issue companies a VASP license that permits global operation. Individual countries bring the relevant business within registration, licensing or other regulatory approaches, and local law should be consulted. Promotional materials that state only "holds a VASP" without stating the country, the regulator and the scope provide far from sufficient information.
CASP: EU Authorization Still Depends on the Approved Services
Under MiCA, a CASP may engage in different services such as custody, exchange and transfer on behalf of clients; the authorization should specify the concrete scope, and qualifying existing financial institutions have a specific pathway as well. Accordingly, obtaining an exchange qualification should not be directly interpreted as also permitting the operation of all wallet or trading platform functions. A CASP is also not equivalent to a stablecoin issuance qualification, and it does not automatically cover fiat payment business; "crypto-asset service provider" and "issuer" are roles that must be kept separate.
How to Compare a "License Package"
Suppose two service providers quote MSB registration and CASP authorization respectively; one cannot compare only the fees and estimated completion dates. Each should be required to explain, using the same product flow: which entity provides which services, which customers it may serve, whether local management personnel are required, and which business is still undertaken by third parties. Then verify the results against the official registers to confirm that what is displayed is a valid status rather than an application receipt, an expired registration or the qualification of another company within the group. It should also be confirmed which legal entity holds the qualification; certificates, training attestations or association memberships produced by agents should not be treated as an operating license granted by a regulator merely because they look similar.
Recommended Actions
- Require quotes to specify the country, the regulator, the name of the law, the concrete scope of services and the matters not covered.
- Distinguish between statuses such as completed registration, formal authorization, application in progress and transitional operation.
- Match the planned receipt of funds, exchange, custody, transfer and fiat payment item by item, rather than judging by packaged abbreviations.
Information note: This article provides general information and does not replace legal advice based on specific facts.
References
- FinCEN alert on scams involving MSB registration — FinCEN
- Register your MSB or FMSB — FINTRAC
- Updated Guidance for a Risk-Based Approach to Virtual Assets and VASPs — FATF
- MiCA Article 59 — ESMA
