According to the press release, the EBA will focus on:

i) implementing the EU banking package (Capital Requirements Regulation - CRR III / Capital Requirements Directive - CRD VI); 

ii) monitoring financial stability and sustainability; 

iii) providing a data infrastructure at the service of stakeholders;

iv) developing oversight and supervisory capacity for the Digital Operational Resilience Act (DORA) and the Markets in Crypto Assets Regulation (MiCA); and

v) increasing attention on innovation and consumers (including access to financial services) while preparing the transition to the new anti-money laundering and countering the financing of terrorism (AML/CFT) framework. 

The statement is intended to encourage timely preparatory actions to MiCA application, with the aim to reduce the risks of potentially disruptive and sharp business model adjustments at a later stage, to foster supervisory convergence, and to facilitate the protection of consumers.

The statement includes ‘guiding principles’ to which financial institutions (and other undertakings) carrying out ART/EMT activities are encouraged to have regard until the application date. These guiding principles encompass:

(i) disclosures to, and fair treatment of, potential acquirers and holders of ARTs and EMTs,

(ii) the business model,

(iii) sound governance, including effective risk management,

(iv) reserve, recovery and redemption arrangements, and

(v) communications with the relevant competent authority.

The statement is accompanied by a template that financial institutions (and other undertakings) intending to carry out, or carrying out, ART/EMT activities, are encouraged to communicate, on a timely basis, to the relevant competent authority.

The EBA reminded consumers that prior to 30 June 2024, ARTs and EMTs do not constitute regulated instruments under MiCA and so do not yet benefit from the rights and protections set out in MiCA. 

The report identifies 12 good practices that national competent authorities and other public entities can follow when designing and implementing their financial education initiatives.

The Joint Committee of the ESAs advises national competent authorities, financial institutions and market participants to take a number of policy actions including:

1. Supervisors should continue to monitor risks to retail investors some of whom buy assets, in particular cryptoassets and related products, without fully realising the high risks involved. 

"Some retail investors may not be fully aware of the long-term effects of rising inflation on their assets and purchasing power. In the context of growing retail participation and significant volatility in cryptoassets and related products, retail investors should be aware of the risks stemming from these. The recent events and subsequent selloff of cryptoassets raises concerns on the appropriate assessment of the risks and the developments of this market segment going forward and requires particular attention of financial institutions and supervisors. Where disclosures are ineffective, these risks are compounded.

2. Financial institutions and supervisors should continue to carefully manage environmental related risks and cyber risks. 

"They should ensure that appropriate technologies and adequate control frameworks are in place to address threats to information security and business continuity, including risks stemming from increasingly sophisticated cyber-attacks."

Key workstreams include:

• Digital finance – extensive technical discussions on topics such as cryptoassets and digital operational resilience;
• Sustainability – the development of the regulatory and supervisory framework for sustainability-related disclosures, including the delivery of two sets of draft Regulatory Technical Standards (RTS) under the Sustainable Finance Disclosure Regulation (SFDR);
• Consumer protection – work to prepare the response to the Call for Evidence from the European Commission in the context of the review of the PRIIPs Regulation, following the submission of the draft RTS in January 2021; and
• Securitisation – the delivery of a report on the implementation and functioning of the Securitisation Regulation as well as an Opinion on its jurisdictional scope.

The ESAs said consumers face "the very real possibility of losing all their invested money if they buy these assets" and set out key steps consumers can take to ensure they make informed decisions.

The warning comes in the midst of growing consumer activity and interest in cryptoassets and the aggressive promotion of those assets and related products to the public, including through social media.

The EBA's priorities are:

• monitoring the regulatory perimeter, including assessing current authorisation and licencing approaches to FinTech firms, and analysing regulatory sandboxes and innovation hubs to identify a set of best practices to enhance consistency and facilitate supervisory co-ordination;
• monitoring emerging trends and analysing the impact on incumbent institutions' business models and the prudential risks and opportunities arising from the use of FinTech;
• promoting best supervisory practices on assessing cybersecurity and promoting a common cyber threat testing framework;
• addressing consumer issues arising from FinTech, in particular in the areas of unclear regulatory status of FinTech firms and related disclosure to consumers, potential national barriers preventing FinTech firms from scaling up services to consumers across the single market, and the appropriateness of the current regulatory framework for virtual currencies; and
• identifying and assessing money laundering/terrorist financing risks associated with regulated FinTech firms, technology providers and FinTech solutions. 

As mandated by the European Commission's 2018 FinTech action plan, the EBA and the other European Supervisory Authorities (ESAs) (namely, the European Securities and Markets Authority and the European Insurance and Occupational Pensions Authority) will carry out specific tasks relating to FinTech.

Some areas of focus include authorisations issues, regulatory sandboxes and innovation hubs, knowledge sharing among FinTech firms, supervisors and regulators, and virtual currencies.

In respect of virtual currencies, the ESAs will work on the regulatory mapping of the current requirements on virtual currencies in order to assess whether the current framework is appropriate with a view of publishing an EBA report and/or opinion addressed to EU legislators.

The Roadmap also announces the creation of a FinTech Knowledge Hub to enhance knowledge sharing and foster technological neutrality in regulatory and supervisory approaches.

Andrea Enria, the EBA's Chairperson, said:

"The EBA's Knowledge Hub will ensure that EU supervisors share best practices and adopt a technologically neutral approach to the application of new technologies in the financial sector. This will help facilitate innovation and scalability across the single market."