EU Faces Pressure to Relax Stablecoin Reward Restrictions
More than 50,000 Europeans have called on the European Commission to relax restrictions on stablecoin rewards under the Markets in Crypto-Assets (MiCA) framework. The campaign, organized by Stand With Crypto EU, seeks to allow regulated stablecoin providers to offer incentives such as cashback, loyalty benefits, and fee reductions to users.
The push comes as the European Commission closed its MiCA review consultation on September 30. A separate petition supporting a more permissive approach to stablecoins has gathered over 126,000 signatures. Campaigners argue that current restrictions make euro-denominated stablecoins less competitive compared to traditional financial products.
MiCA already prohibits interest payments on certain stablecoins and treats some reward mechanisms as equivalent to interest. European central banks are advocating for stricter rules, including extending the prohibition on stablecoin interest to cover lending, borrowing, and staking arrangements that generate yield.
The debate highlights two opposing approaches: campaigners seeking greater flexibility to boost stablecoin adoption and central banks focused on mitigating financial and liquidity risks. The outcome of the MiCA review could significantly impact the design and distribution of stablecoins across the European Union.