- The European Banking Authority (EBA) has advised stablecoin issuers to promptly comply with upcoming EU crypto regulations.
- The EBA has published initial guidelines for public feedback on requirements for stablecoin issuance under MiCAR.
- European Securities and Markets Authority has introduced draft rules for crypto asset service providers.
The European Banking Authority (EBA) has announced in place some recent regulations in the interest of risk management and consumer protection. As part of “guiding principles,” the EBA has advised stablecoin issuers to promptly implement necessary actions in order to adhere to upcoming cryptocurrency regulations set by the European Union, which will be enforced within a year.
On Wednesday, July 12, the EBA published its initial set of guidelines for public feedback, aiming to provide clarity on the requirements of the Markets in Crypto Assets Regulation (MiCAR) regarding the issuance of stablecoins. These guidelines outline various provisions such as a perpetual right of redemption and instructions on handling complaints. Furthermore, the EBA intends for these measures to become effective on June 30, 2024.
Earlier in May, the Economic and Financial Affairs Council of the European Union, which consists of finance ministers from all member states, approved the long-awaited Markets in Crypto-Assets (MiCA) regulation. The bill received overwhelming support, with finance ministers from all 27 member states voting in favor, along with amendments to various regulations and directives associated with the new legislation.
With the current framework law adoption, the EBA stated,
The regulation] is intended to encourage timely preparatory actions to MiCAR application, with the objectives to reduce the risks of potentially disruptive and sharp business model adjustments at a later stage, to foster supervisory convergence and to facilitate consumer protection.
In addition to the EU’s regulatory updates, draft rules for crypto asset service providers (CASPs) have been introduced by the European Securities and Markets Authority (ESMA). ESMA’s goal is to separate customer assets from company funds to prevent situations similar to the FTX from arising.
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