ECB Seeks Overhaul of MiCA Stablecoin Reserve Rules

European Central Bank (ECB) and EU national central banks are pushing for changes to the MiCA stablecoin reserve rules. They want to remove the mandatory bank-deposit requirement, which currently requires stablecoin issuers to hold at least 30% of their reserves in credit institutions. This rises to 60% for significant stablecoins.

The ECB and national central banks argue that this regulation could create new risks for commercial banks. If stablecoins grow substantially, consumers may move money from ordinary bank accounts into stablecoins, draining relatively stable retail deposits from banks. MiCA would then send part of that money back into the banking system through stablecoin issuers.

The ECB is concerned about what happens during heavy redemptions. Stablecoin reserves could be withdrawn rapidly, potentially leaving banks increasingly dependent on funding sensitive to crypto market conditions. This could replace stable retail deposits with less stable deposits from stablecoin companies.