EBA Calls for MiCA Changes on Stablecoins, Crypto Lending & Classification

Key Takeaways

• Stablecoin Rules Face Review: The EBA said MiCA’s requirements for asset-referenced tokens and electronic money tokens are broadly appropriate but recommended stronger safeguards for third-country multi-issuer schemes.
• Crypto Classification Needs Clarity: Uncertainty over MiCA’s scope and definitions is creating avoidable costs and product delays, which the EBA said can impede innovation and undermine EU competitiveness.
• Crypto Lending Could Face Regulation: The EBA wants the European Commission to consider regulating crypto-asset lending, including when crypto-asset service providers facilitate access to decentralized lending protocols.
• Reporting Requirements Could Change: The authority recommended reviewing reporting requirements for issuers and crypto-asset service providers to strengthen supervision and risk monitoring.

Deep Dive

The European Banking Authority has urged the European Commission to use its review of the Markets in Crypto-Assets Regulation to strengthen safeguards around certain stablecoin arrangements, clarify which crypto-assets fall within the law and consider bringing crypto lending under regulatory rules. The recommendations amount to an early accounting of where Europe’s landmark crypto regime is holding and where experience has begun to expose uncertainty.

On the central rules governing asset-referenced tokens, or ARTs, and electronic money tokens, known as EMTs, the EBA’s assessment is reassuringly uneventful. The existing requirements are, in its view, broadly appropriate. It is what happens when those instruments are placed inside more complicated structures that begins to trouble the regulator.

The clearest example is the third-country multi-issuer stablecoin scheme. The EBA said such arrangements can pose “significant to very significant risks” and recommended that the Commission consider regulatory changes to strengthen the framework around them. It also wants another look at issuers’ reserve requirements, particularly the minimum amount of reserves that must be held as deposits, though it stressed that any changes should preserve effective risk management.

This is a narrower argument than a wholesale reconsideration of MiCA’s treatment of stablecoins. The EBA is not saying the architecture is wrong. It is saying that certain arrangements now pressing against that architecture deserve rules more closely fitted to the risks they create.

There is a more elementary difficulty elsewhere in the regulation. Before a firm can comply with MiCA, it must know whether and how MiCA applies to what it has built.

The classification of crypto-assets has proved challenging for both industry and supervisors, the EBA said, with uncertainty producing avoidable costs and delays in bringing products to market. Those delays matter beyond compliance departments. In the authority’s assessment, they can impede innovation and undermine the competitiveness of the EU market.

The EBA therefore wants the Commission to consider clarifying MiCA’s scope and definitions. Its response addresses, among other questions, the boundary between MiCA and other pieces of EU financial services legislation, including the Markets in Financial Instruments Directive and the Capital Requirements Directive, as well as the relationship between MiCA and the EU payments framework.

Classification can sound like the dry work of lawyers until a product is waiting on the answer. The line separating one regulatory regime from another determines which obligations apply, which supervisors become involved and what a firm must do before it can proceed. Ambiguity has a cost even when everyone is acting in good faith.

The Question Beyond MiCA

Some of the EBA’s recommendations concern not what MiCA says, but what it presently leaves outside. Crypto-asset lending is among them. The authority encouraged the Commission to consider regulating borrowing and lending activities because of the risks they can pose to consumers. That recommendation extends to situations in which crypto-asset service providers facilitate access to decentralized lending protocols.

The distinction is important. The EBA is not, in this response, attempting to settle the much larger regulatory question of decentralized finance. It is identifying a particular point of contact between regulated crypto businesses and decentralized lending, and asking the Commission to consider whether the law should reach it.

The authority also wants the reporting framework reconsidered. It recommended reviewing requirements for issuers and crypto-asset service providers so that supervisors have the information needed for effective oversight and risk monitoring.

All of this is taking place against the peculiar timetable of a regulatory system still young enough that its first results remain modest. MiCA’s provisions governing ARTs and EMTs began applying on June 30, 2024. The regulation became more broadly applicable on Dec. 30 of that year.

By Sept. 1, 2026, the reference date used by the EBA for its consultation response, 39 EMTs had been issued under MiCA. Not a single ART had been authorized.

Those figures put the review in perspective. Europe is not revisiting a regime with a decade of settled practice behind it. Regulators are examining rules whose consequences are still becoming visible as firms try to classify products, supervisors confront unfamiliar structures and parts of the crypto market continue to develop beyond the categories lawmakers originally drew.

The EBA’s recommendations consequently read less like an attempt to reopen MiCA than an effort to make its boundaries harder to exploit and easier to understand. That means stronger treatment where the authority sees substantial risk, particularly in third-country multi-issuer schemes, but it also means removing uncertainty where regulation itself has become an obstacle.

The Commission now has to decide which of those problems warrant changes to the law. The harder work will be preserving the distinction the EBA’s response implicitly makes throughout: between gaps that expose consumers and markets to risks the framework should capture, and uncertainty created by the framework itself.

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