Answer provided by the European Commission

No, business model whereby a crypto-asset service provider (CASP) provides exchange services where clients are only allowed to collect their balance in fiat currency, without having the possibility to have their crypto-asset transferred is not permitted under MiCA.

Under MiCA, "exchange services" refer to the professional activity of exchanging crypto-assets for fiat currency (which falls within the definition of ‘funds’) or for other crypto-assets. This service is one of several defined crypto-asset services that require a CASP, to obtain authorization.

It is possible for CASPs to propose to their clients that their balance is collected in fiat currencies instead of in crypto assets. 

However, where a client purchases a crypto asset, it gives rise to an obligation on the CASP to transfer the purchased 4 crypto-asset to the client. In that respect, the white paper to be drawn under MiCA must indicate «information on the method and time schedule of transferring the purchased asset-referenced token to the holders». 

A service whereby an entity offers clients to “buy” a crypto-asset that is never delivered, and the client can only and exclusively receive the fiat currency value of such crypto-asset, is not to be allowed as a crypto-asset exchange service.

_Disclaimer: 

_{The answers clarify provisions already contained in the applicable legislation. They do not extend in any way the rights and obligations deriving from such legislation nor do they introduce any additional requirements for the concerned operators and competent authorities. The answers are merely intended to assist natural or legal persons, including competent authorities and Union institutions and bodies in clarifying the application or implementation of the relevant legal provisions. Only the Court of Justice of the European Union is competent to authoritatively interpret Union law. The views expressed in the internal Commission Decision cannot prejudge the position that the European Commission might take before the Union and national courts.}