EU Central Banks Push to Eliminate Stablecoin Deposit Rule - PYMNTS.com

Central banks within the European Union are reportedly pushing to remove a rule that would require stablecoin issuers to hold a portion of their reserves as deposits with commercial banks. The provision, part of the EU's broader Markets in Crypto-Assets (MiCA) framework, has been a point of contention between regulators and the crypto industry.

The debate centers on how stablecoin reserves should be structured to ensure safety and liquidity. Requiring deposits at commercial banks could concentrate risk in the banking system and reduce the flexibility of issuers, while critics argue that alternatives such as government securities may offer comparable stability. Central banks appear to favor eliminating the requirement, though the specific rationale and final scope remain subject to the ongoing rulemaking process.

For markets, the outcome matters because reserve rules directly affect the cost, structure, and attractiveness of euro-denominated stablecoins. What to watch: the final MiCA implementing standards, how the European Banking Authority and national regulators align on reserve composition, and whether issuers adjust their custody or investment strategies in response.