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ESCB Wants MiCA to Close Stablecoin Yield Loopholes
The European System of Central Banks wants a future MiCA revision to stop indirect stablecoin yield through lending, borrowing and staking, while replacing the current 30%—or 60% for significant tokens—bank deposit re... The central banks’ central argument is that electronic money tokens should serve payments rather...
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Key takeaways
- The European System of Central Banks wants a future MiCA revision to stop indirect stablecoin yield through lending, borrowing and staking, while replacing the current 30%—or 60% for significant tokens—bank deposit re...
- The central banks’ central argument is that electronic money tokens should serve payments rather than become savings like products that offer returns through unregulated crypto structures.
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openai.comCreate a landscape editorial hero image for this Studio Global article: What changes has the European System of Central Banks asked the European Commission to make in its 2027 review of MiCA—including extending t. Article summary: The ESCB has asked the Commission to close MiCA’s stablecoin-yield loopholes, replace fixed bank-deposit reserve quotas with short-maturity liquidity requirements, and tighten supervision. Its core view is that e-money t. Topic tags: general, news, general web, user generated, government. Style: premium digital editorial illustration, source-backed research mood, clean composition, high detail, modern web publication hero. Use reference image context only for broad subject, composition, and topical grounding; do not copy the exact image. Avoid: logos, brand marks, copyrighted characters, real person likenesses, fake screenshots, UI text, readable text, watermar
The European System of Central Banks (ESCB)—the ECB and EU national central banks—has asked the European Commission to tighten the EU’s Markets in Crypto-Assets Regulation (MiCA) in a future review. Its principal concern is that a prohibition on stablecoin remuneration can be bypassed when returns are delivered indirectly through crypto products rather than paid directly by an issuer or regulated platform. 2
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The recommendations are not law. The Commission will decide whether to propose changes, which would then require the EU legislative process. 4
A broader ban on stablecoin remuneration
MiCA already prohibits stablecoin issuers and crypto-asset service providers from paying remuneration on the tokens within its scope. The ESCB wants that prohibition retained and applied more effectively where a product produces the same economic result outside the conventional regulated perimeter. 2
The target is indirect yield attached to stablecoin holdings. The ESCB specifically points to crypto lending, borrowing and staking services that can replicate the economic effect of remuneration even where a token issuer does not itself pay interest. 2
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This is an activity-based regulatory approach: the relevant question is whether a service economically rewards holding a stablecoin, rather than whether it is presented as a lending product, staking arrangement, decentralised structure or another technical wrapper. In practice, that direction could affect DeFi-style arrangements and incentive mechanisms that provide a return linked to holding or deploying stablecoins.
Why the ESCB sees yield as a problem
The ESCB’s position is that electronic money is intended for payments, not as a means of saving. If token holders can earn a return through adjacent products, the central banks argue, a payment-focused token begins to resemble a savings product. 8
That distinction matters because it can blur the practical boundary between electronic money and bank deposits. The concern is also competitive: bank-like economic activity may be offered through crypto arrangements without the same prudential framework that applies to deposit-taking institutions. 2
The proposal is therefore not simply a ban on a particular interest-payment mechanism. It is an attempt to prevent stablecoin yield from reappearing through lending, borrowing, staking or similar structures.
Replace fixed bank-deposit quotas with liquidity buckets
The ESCB also wants MiCA to remove its fixed requirement for reserve assets to be held as bank deposits: at least 30% of reserves, rising to 60% for significant tokens. 1
In its place, the central banks propose maturity-based liquidity requirements. MiCA would specify minimum percentages of reserve assets that mature within one working day and within five working days. 1
The policy objective is to focus on whether an issuer can meet redemption demands quickly. The ESCB warns that forcing a large fixed share of reserves into bank deposits can create a channel through which a stablecoin run strains bank funding and deposit stability. 1
Tighter supervision beyond stablecoin reserves
The ESCB’s response also calls for tougher and more consistent supervision of crypto firms. Reported recommendations include clearer prudential rules for crypto-asset service providers, clarification of statutory-audit requirements, and risk-sensitive own-funds requirements. 2
The common theme is that risks should not fall outside oversight merely because an activity is delivered through a different legal or technological structure. Lending, borrowing and staking are central examples because they can create economically similar exposures while sitting partly outside MiCA’s established regulatory perimeter. 2
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What this could mean for crypto platforms and users
If the Commission takes up the proposal, the most consequential change would be a wider test for stablecoin rewards. Platforms could face scrutiny not only for explicitly paying interest on a stablecoin balance, but also for products that provide an economically equivalent return.
For stablecoin issuers, the reserve discussion points in a different direction: less emphasis on a fixed allocation to bank deposits, and more emphasis on assets that can be converted or mature quickly enough to support redemptions. The outcome would depend on the detailed thresholds eventually proposed by EU lawmakers; the ESCB has called for one- and five-working-day liquidity buckets, but the recommendations do not themselves set the final rule. 1
The key takeaway
The ESCB is asking the EU to make MiCA more substance-based. Its preferred framework would prevent indirect stablecoin yield from turning payment tokens into savings-like products, while judging reserve adequacy by near-term liquidity rather than a fixed bank-deposit quota. 1
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The European System of Central Banks wants a future MiCA revision to stop indirect stablecoin yield through lending, borrowing and staking, while replacing the current 30%—or 60% for significant tokens—bank deposit re...
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The European System of Central Banks wants a future MiCA revision to stop indirect stablecoin yield through lending, borrowing and staking, while replacing the current 30%—or 60% for significant tokens—bank deposit re... The central banks’ central argument is that electronic money tokens should serve payments rather than become savings like products that offer returns through unregulated crypto structures.