Ka.App Discontinues Services Following MiCA Regulatory Assessment

Kasta CCHS Ltd,  the Bulgaria‑based operator of the crypto payments & wallet platform “Ka.App”, has announced this week the discontinuation of its crypto-asset services.  

The decision follows an internal review of the European Union’s Markets in Crypto‑Assets Regulation (MiCA) and Bulgaria’s own Markets in Crypto‑Assets Act (MCAA), which together set new licensing requirements for crypto service providers.

In a notice to clients, Kasta stated that it will not pursue a CASP license under MiCA. As a result, the company will discontinue Ka.app, a platform that allows users to buy, convert, and transfer cryptocurrencies and fiat.

To streamline operations, Kasta stopped onboarding new clients as of December 19, focusing instead on an orderly withdrawal process. The company notified users to withdraw all funds from the platform by February 17, after which the accounts will be suspended. Kasta clients who fail to withdraw funds by the deadline can request a manual withdrawal.

MiCA Sets a New Regulatory Standard in Europe

After years of development, the Markets in Crypto‑Assets Regulation (MiCA) came through as the European Union’s first comprehensive framework for categorizing and regulating crypto assets and activities. 

The regulatory body became fully applicable by December 30, 2024, and some of its demands included mandatory CASP licensing for all crypto-asset service providers, capital, and reserve thresholds. 

Moreover, the change to a more regulated crypto infrastructure in Europe led to several firms facing roadblocks. Industry leaders like Tether and Binance faced significant hurdles to comply with MiCA’s strict rules for reserves and regular audits. 

If compliance was already difficult for some of the biggest firms in the cryptocurrency sector, for smaller startups in the E.U., meeting MiCA’s requirements posed steep costs and heavy obligations.

Startups Struggle to Adapt to Rising Compliance Costs

Ilja Nikiforov, an Estonian lawyer specialized in crypto and Web3, reports that obtaining a MiCA license can take up to half a year. He also notes how the cost of compliance has increased up to sixfold after the new regulatory framework. 

Furthermore, crypto activity in Europe is expected to continue decreasing in the coming months. France’s AMF (Financial Markets Authority) noted up to 90 crypto firms operating without MiCA licenses in the country -- with 40% of them expected to stop operations by MiCA’s official deadline of June 30, 2026. 

Meanwhile, the United Arab Emirates may prove the likely new home for crypto firms failing to comply with European regulations. Notably, Binance — which left the Netherlands in 2023 after failing to secure a license from the Dutch central bank — recently secured three distinct licenses under Abu Dhabi Global Market’s (ADGM) framework.