Europe’s central banks have made their position clear: the current rules governing crypto aren’t strict enough, and they want them tightened before the next phase of the continent’s landmark regulatory framework takes hold.
The European Central Bank, acting through the broader European System of Central Banks, submitted a formal response to the European Commission’s ongoing review of the Markets in Crypto-Assets Regulation on September 22, 2026. The response calls for retaining the existing ban on interest payments for stablecoins, introducing new liquidity-based reserve requirements, and creating centralized EU-level supervision for the largest crypto firms operating in the bloc.
What the ECB actually wants
The stablecoin interest ban sits at the heart of the ESCB’s position. Under MiCA, issuers of electronic money tokens and asset-referenced tokens are already prohibited from paying yield to holders. The ECB wants that ban to stay, and potentially expand.
The ESCB also flagged what it called “material challenges” in enforcement, pointing to crypto firms operating within the EU that are not fully compliant with existing rules. The proposed remedy is enhanced supervisory powers and stricter oversight of significant crypto-asset service providers, or CASPs, particularly those operating at scale across multiple member states.
On reserves, the ECB is pushing to replace the current requirement that stablecoin issuers hold between 30% and 60% of assets in bank deposits. The proposed alternative is a liquidity-bucket model, where a defined share of reserve assets must mature within one to five working days. The goal is to make stablecoin reserves more immediately accessible in a stress scenario, reducing the risk that a sudden wave of redemptions could trigger contagion into the broader financial system.
Why MiCA is already being reviewed
MiCA came into force in 2024, with stablecoin-specific provisions beginning to apply from mid-2024. The MiCA review began in 2026.
The ESCB response proposes new powers specifically targeting tokens pegged to non-euro currencies, giving regulators tools to curb their spread if they begin to pose systemic risks to eurozone financial stability.
What this means for stablecoin issuers and the broader market
For issuers of euro-backed stablecoins, the prohibition on yield payments puts euro stablecoins at a structural disadvantage against US dollar competitors, particularly as American regulators under the current administration have signaled a more permissive approach to crypto products.
The proposed liquidity-bucket reserve rules carry their own implications for issuers. Maintaining a portfolio of assets that can be liquidated within one to five working days is more constraining than the current deposit-based model, and it limits the ability to invest reserves in higher-yielding instruments even where yield is not passed on to users.
For crypto-asset service providers operating in Europe, the push for centralized EU-level supervision signals a potential shift away from the current model, where oversight is largely delegated to national competent authorities.
The MiCA review is still in process, and the ESCB’s submission is an input into that consultation rather than final policy.
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