Blockchain for Europe is urging targeted fixes to the EU’s landmark Markets in Crypto Assets regulation (MiCA), arguing that tweaks are needed to make euro-pegged stablecoins globally competitive.
In a report titled “Reforming MiCA for Euro Stablecoins,” the industry group — which represents international blockchain firms operating in the EU — says MiCA succeeded in making euro-denominated stablecoins safer, but in doing so has left them disadvantaged versus dollar-backed rivals. Today, euro-pegged stablecoins account for less than 1% of global stablecoin volume, a share the report calls “disproportionately low” given the euro’s wider role in global markets.
The group warns that overly strict rules can be counterproductive: regulators who push compliance so far that projects relocate offshore will have failed to build a domestic ecosystem. Blockchain for Europe even frames the current situation as Europe sitting on the “downward-sloping part of the regulatory Laffer curve,” where higher regulatory costs reduce the regulated activity the rules aim to encourage.
Context and regulatory debate
- The ECB and the European Systemic Risk Board have voiced concerns about financial stability risks linked to stablecoins, pushing for tougher measures — including proposals to ban multi-issuer stablecoins in the bloc.
- The European Banking Authority, however, said in November that MiCA already provides safeguards against those risks.
- The report argues that refining MiCA can both protect financial stability and help build a strong, regulated European stablecoin market that serves citizens, businesses and the Savings and Investment Union.
Key reform proposals
Blockchain for Europe suggests a set of practical changes designed to improve liquidity, reduce concentration risk, and lower barriers to entry:
- Allow regulated remuneration on euro-denominated electronic money tokens (EMTs) to support liquidity — the report says there is no valid reason to ban this.
- Reduce or remove the minimum bank deposit requirement and replace the rigid 30%/60% reserve thresholds with a principle-based, risk-sensitive approach to reserve composition. This would let issuers diversify across high-quality liquid assets instead of forcing concentrated bank exposure.
- Broaden and diversify the range of eligible reserve assets to improve market functioning and competition.
- Introduce a proportionate, risk-based transparency regime for EMTs to limit concentration risk without deterring new entrants.
- Enable calibrated access to central bank infrastructure and clarify a workable cross-border framework for stablecoin use across the EU.
Broader supervision discussion
The report arrives as the ECB backs a push to centralize oversight of key financial markets — including crypto — under the European Securities and Markets Authority (ESMA). That plan, floated earlier in MiCA discussions and reportedly supported by the ECB and the European Commission, was previously shelved and faces opposition from some member states and industry participants.
Robert Kopitsch, Secretary General of Blockchain for Europe, has argued that any move toward centralized supervision should be based on “concrete” evidence gathered from MiCA’s early years. He also emphasized that national regulators currently maintain more direct, frequent contact with firms, which has value for supervision.
Bottom line
Blockchain for Europe’s report frames the MiCA story as one of trade-offs: safeguarding financial stability is essential, but so is crafting rules that let euro stablecoins grow and compete internationally. The group wants regulators to fine-tune MiCA so Europe can host a robust, regulated euro stablecoin market rather than push projects to friendlier jurisdictions.
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