ECB Seeks Tighter Rules for Stablecoins, Crypto Firms, and Staking Activities

The European Central Bank is urging the European Union to tighten regulations on stablecoins, staking activities, and crypto firms. This push comes as Brussels reviews the Markets in Crypto-Assets Regulation (MiCA), which has been governing Europe's crypto sector since December 2024.

Central banks want to remove MiCA's requirement for stablecoin issuers to hold 30% to 60% of their reserves in bank deposits. Instead, they could hold more highly liquid assets such as Treasury bills and repurchase agreements. This change would reduce issuers' reliance on commercial banks while preserving quick access to reserve funds.

The central banks also support EU-level supervision for crypto companies and stronger safeguards around staking activities. They want a broader ban on stablecoin interest payments and new powers over tokens linked to foreign currencies, which could affect dollar-pegged tokens across European markets.