EU Stablecoin Rules Under Fire as 50,000 Europeans Urge Relaxation

More than 50,000 Europeans have signed a petition urging the European Commission to relax limits on stablecoin 'rewards' as it reviews the bloc's Markets in Crypto-Assets (MiCA) rules. The petition, led by advocacy group Stand With Crypto EU, argues that the current approach to stablecoins puts regulated euro-linked stablecoins at a disadvantage compared to traditional bank deposits and e-money products.

The group claims its outreach has dwarfed past participation levels during earlier EU crypto consultations, with over 50,000 submissions to the European Commission during the MiCA consultation. Stand With Crypto EU is pushing for rewards such as cashback, loyalty benefits, and fee reductions for holders of regulated stablecoins, rather than interest payments.

The debate is unfolding amid central bank concerns about stablecoins' financial stability implications, including liquidity and bank-deposit dynamics. European central banks have asked for changes to how MiCA treats stablecoins, including extending the prohibition on stablecoin interest to certain yield-generating arrangements and revising reserve liquidity expectations.