The European Central Bank and EU national central banks are urging Brussels to reconsider a key MiCA requirement for stablecoin issuers. The proposal targets rules that require issuers to keep a portion of their reserves in bank deposits.
Under the Markets in Crypto-Assets Regulation, stablecoin issuers generally must hold at least 30% of reserves as bank deposits. The requirement rises to 60% for significant stablecoins.
The central banks now argue that the rule could create risks for the banking system. Their concern centers on replacing relatively stable retail deposits with potentially more volatile funding from stablecoin issuers.
Why the ECB wants a change
The ECB has proposed shifting the focus toward reserve assets that can mature or become available quickly. The suggested approach would require a portion of reserves to be accessible within one to five working days.
That would give issuers greater flexibility while preserving liquidity, according to the central banks. The ECB has previously warned that stablecoin runs could trigger rapid withdrawals from banks holding issuer reserves.
The debate also highlights a broader tension in European crypto regulation. MiCA was designed to strengthen consumer protection and reserve liquidity, but regulators now face concerns about how those requirements interact with traditional banking.
Tether’s position adds pressure
Tether has long relied heavily on short-term government securities and other liquid assets rather than large bank-deposit holdings. European rules have therefore presented a structural challenge for issuers whose reserve strategies differ from MiCA’s requirements.
However, available reporting does not establish that Tether directly caused or formally prompted the ECB’s latest proposal. The central banks’ recommendation instead reflects wider concerns about financial stability and the interaction between stablecoins and commercial banks.
The ECB is also examining broader stablecoin risks, including arrangements in which the same token could be issued through entities inside and outside the EU.
For the cryptocurrency industry, any change would be significant. A revised reserve framework could alter how stablecoin issuers manage billions of dollars in assets while reshaping the balance between crypto markets and European banks.
