The Digital Euro Association Analyzes Europe's MiCA Regulation and Its Impact on Stablecoin Issuance

Today the Digital Euro Association published a report analyzing Europe’s MiCA regulation and its impact on stablecoin issuance.

The Digital Euro Association (DEA) has published a report analyzing the Markets in Crypto Assets (MiCA) Regulation and its impact on the issuance of stablecoins in Europe. The report provides an in-depth critique of the MiCA Regulation and suggests enhancements for future implementation.

The report begins by highlighting the potential for MiCA to serve as the foundation for a global regulatory model for stablecoins. It argues that the EU’s significant experience in regulating stablecoins through MiCA could inform the development of common standards for stablecoins worldwide.

However, the report also raises concerns about the impact of MiCA on the international issuance of stablecoins. It notes that MiCAR (the upcoming Crypto Assets Regulation) requires issuers to engage custodians authorized under EU regulations, while international stablecoins (asset referenced tokens) may already have foreign custodians. This could pose challenges for international stablecoin issuers.

The report also discusses the implications of MiCA for bank-issued stablecoins and tokenized deposits. It argues that the classification of electronic money tokens under a separate piece of legislation (e-Money Directive) raises questions about the extent of Anti-Money Laundering (AML) obligations for stablecoin issuers.

Overall, the report provides a comprehensive analysis of the Markets in Crypto Assets (MiCA) Regulation and its impact on the issuance of stablecoins in Europe. It highlights key areas for consideration both within the EU and in the broader context of global stablecoin regulation.

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