The European Union’s banking and markets regulators have unveiled a series of draft technical standards for stablecoins linked to multiple currencies or assets, marking a significant step under the EU’s Markets in Crypto Asset (MiCA) regulation. This development outlines the requirements for issuers to address complaints about these asset reference tokens (ARTs), a category distinct from stablecoins pegged to a single currency like the euro or the U.S. dollar.
Crafting the Regulatory Framework
The European Banking Authority (EBA), in collaboration with the EU’s markets regulator, the European Securities and Markets Authority (ESMA), is spearheading the effort to formulate these standards. The recent publication of draft Regulatory Technical Standards (RTS) is part of a broader initiative to create a comprehensive set of rules governing the crypto market within the EU.
This batch of RTS focuses on the “requirements, templates, and procedures for complaints received by issuers” of ARTs. These tokens, unlike traditional stablecoins, may reference multiple currencies or other assets, including cryptocurrencies. An example of such a proposal was Libra (later renamed Diem), put forward by Meta.
MiCA Regulation: A Landmark Legislation
The MiCA regulation represents a landmark piece of legislation aimed at regulating the crypto assets market in the EU. It places a strong emphasis on the operations of stablecoin issuers, among other aspects. Although the full MiCA regulation is slated to take effect in December, the specific rules pertaining to stablecoins are expected to be enforced starting this summer.
Consultation and Future Steps
The consultation phase for these draft standards occurred between July and October of the previous year, indicating the regulators’ commitment to incorporating feedback from various stakeholders. As the EBA and ESMA continue to consult on other Regulatory Technical Standards, the crypto industry watches closely. These regulatory efforts underscore the EU’s proactive stance in establishing a secure and transparent environment for the burgeoning crypto market.
