Abstract

Crypto-assets are the subject of considerable controversy, both in terms of their valuation (valuation methods) and the numerous risks they pose to investors. The crypto-asset market is unfortunately known for speculation, high price volatility, manipulation, and sophisticated marketing techniques. Providing advice under such conditions therefore entails significant and multifaceted risk. For this reason, the service of crypto-asset advisory may and should attract attention—particularly in relation to the mechanisms for protecting clients using this service and the potential civil liability of entities providing it.

The Regulation on Markets in Crypto-Assets (MiCAR) introduces a legal framework for the provision of crypto-asset advisory services. Once MiCAR becomes applicable, offering such a service will require obtaining a license issued by the Polish Financial Supervision Authority (KNF), after first convincing the supervisory authority that the legal requirements—especially those aimed at client protection—are met. These requirements, along with the specific nature of the advisory subject (i.e., crypto-assets), call for deeper reflection on the proposed, expected, theoretical, and practical dimensions of this service.

However, in order to have a meaningful and informed discussion about crypto-asset advisory services, it is necessary to compare this service with investment advisory services as defined in Directive 2014/65/EU (MiFID II). Investment advice under MiFID II has a long-standing tradition—one that not only should, but must, be drawn upon. This comparison will help illustrate the specific nature of crypto-asset advisory and lead to the identification of the key obligations associated with its provision. Highlighting the key issues in crypto-asset advisory should help us understand what lies ahead for financial market participants in just a few months.