ECB Seeks Stricter Rules on Cryptocurrencies
The European Central Bank (ECB) is calling for tougher rules on cryptocurrencies in Europe. The ECB, along with the EU's national central banks, has published a response to the European Commission's review of the Markets in Crypto-Assets Regulation (MiCA). MiCA has been in effect since December 2024 and regulates cryptocurrencies and the firms that trade them.
The ECB wants stricter rules on stablecoins, which are designed to hold a steady value, usually by tracking the US dollar. The central banks argue that issuers of stablecoins should be prohibited from paying interest on them and that this ban should be extended to indirect rewards such as loyalty-programme benefits. This is in contrast to the 2025 GENIUS Act in the US, which banned US stablecoin issuers from paying interest but left exchanges free to offer rewards.
The ECB also wants stronger tools against tokens pegged to foreign currencies. The central banks argue that authorities should be able to impose a prohibition on issuing new tokens and an obligation to redeem existing tokens if they judge the tokens pose a threat, including to financial stability.