Crypto firms that have obtained licenses under the European Union's Markets in Crypto-Assets (MiCA) framework may still face an uncertain future as the cost of maintaining compliance continues to climb, according to Giovanni Cunti, CEO of Gate Europe.

Speaking on a podcast, Cunti said that stricter regulatory requirements have made it increasingly difficult for new entrants to compete in the EU market, with some licensed firms ultimately unable to absorb the ongoing operating costs imposed by the MiCA framework.

"I think there are going to be quite a few more of the ones that acquire MiCA license that will not be capable to sustain the cost and the resources that are needed to carry on this business in the long term," Cunti said.

His warning highlights that regulatory approval is only the starting point. Sustained expenditure on legal teams, compliance staff, cybersecurity, reporting systems, and capital requirements is placing significant pressure on firm profitability.

MiCA, which fully took effect for crypto-asset service providers on December 30, 2024, has reshaped Europe's cryptocurrency market by requiring companies to meet uniform standards before they can serve customers across the bloc. The regulation, overseen jointly by the European Securities and Markets Authority (ESMA) and the European Banking Authority (EBA), covers exchanges, custodians, wallet providers, and stablecoin issuers. While the framework provides legal certainty and access to the EU's single market of over 400 million consumers, it has also driven up the cost of doing business — particularly for smaller exchanges and startups that lack the scale to absorb recurring compliance expenses.

Approximately 200 out of 1,200 firms have reportedly been licensed under MiCA's crypto regulations so far.

The comments come weeks after MiCA's full licensing deadline took effect, leaving only a fraction of previously active crypto firms authorized to operate across the EU. Many others have been forced to exit the market or suspend services entirely. Under the transitional provisions, firms that were already operating under national regimes were given a grace period to continue while pursuing full authorization, though several chose to wind down EU operations rather than invest in compliance.

Larger, well-capitalized exchanges are expected to benefit as the market consolidates around players capable of shouldering the long-term cost of compliance. Gate Europe's parent company, Gate.io, ranks among the world's larger cryptocurrency exchanges by trading volume, positioning it among the firms with resources to navigate the new regulatory landscape.

Cunti also cautioned that the regulatory environment could drive projects away from Europe. "We may need to be prepared that some projects, possibly some important projects, may be looking at other jurisdictions with different guidelines," he said. Competing jurisdictions including the United Kingdom, Switzerland, the United Arab Emirates, and Singapore have each developed their own digital asset regulatory frameworks, offering alternative paths for firms seeking to operate outside the EU regime.

The full impact of MiCA on the European crypto landscape remains to be seen as licensed firms navigate the ongoing financial and operational demands of compliance.