EU Regulators Issue Stablecoin Guidance, Calls For Compliance Ahead Of MiCA

cryptonews.com:

Financial regulators within the European Union (EU) have urged stablecoin issuers alongside other industry participants to adopt the guidelines set out in Markets In Crypto Assets Regulation (MiCA).

MiCA is the first comprehensive digital asset regulatory framework that covers exchanges, assets, and stablecoins amongst others. Billed to come into effect in June 2024, authorities have advised market players to begin preparations to ensure compliance. 

In a new statement released today by the European Banking Authority, the body listed “guiding principles” for stablecoin issuers operating in the 27 member countries within the bloc. 

In what many describe as a preparation towards MiCA, firms are to adhere to the full disclosure requirements with users and authorities and adopt MiCA standard risk management policies and business models. 

The statements also include a financial template that firms are advised to follow in terms of communication, reserve, recovery, and redemption arrangements. 

According to the statement, these rules are currently not binding but “encourage timely preparatory actions” to protect investors before the law swings into effect. 

Consumers do not also benefit from the rights and will not be protected by MiCA between now and June 30, 2024. 

“Consumers are reminded that prior to 30 June 2024 (the application date of MiCAR), ARTs and EMTs do not constitute regulated instruments under MiCAR and so consumers do not yet benefit from the rights and protections set out in MiCAR.”

The European Securities Market Authority (ESMA), the EBA’s securities counterpart, also rolled out its first set of proposals since giving the powers under MiCA. 

The new proposals released today apply to firms that are categorized under