European Banking Authority To Conclude Stablecoin Monitoring Guidelines
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According to reports, the European Banking Authority (EBA) aims to complete its stablecoin monitoring framework by this month’s end. This step matches MiCA’s broader rules, which set strict limits on transaction numbers and amounts. Stablecoins cannot handle more than 1 million transactions or exceed daily transaction amounts of 200 million euros.
The EBA is set to issue a detailed report explaining how it will track transaction volumes. Early talks indicate that the cap calculations might not include transactions involving non-EU partners. Nevertheless, dealings with at least one entity within the EU will probably be counted.
These Rules Could Result In Key Stablecoin Players Leaving The European Market
The European Union’s revised stablecoin rules are under the Markets in Crypto Assets (MiCA) legislation. These new rules will change how big companies that issue stablecoins, like Circle and Tether, operate in the European market. These rigid rules restrict stablecoin dealings, which might force key players to leave the European market.
The upcoming rules have raised concerns among stablecoin providers. Circle, the firm that created USDC, and Tether, famous for its USDT, which is pegged to the US dollar, could find it hard to function within the EU.
Under Article 23 of MiCA, stablecoin issuers must stop operations if they exceed the transaction limits. This rule is introduced to protect the euro from being dominated by private virtual currencies.
Launching the MiCA rules is a big step in regulating the EU’s crypto sector. Companies that have been granted a license to operate in one country within the EU can now conduct their business activities. These firms can operate in all the countries that make up the EU without needing separate licenses for each country.
MiCA Regulations on Stablecoins Will Impact Cryptocurrency Exchange Services
Stablecoin issuers have to deal with both following the rules and getting the proper certifications. Circle, which got a conditional registration as a provider of Digital Asset Services from France’s Financial Markets Authority in April, is trying to meet the deadline.
The MiCA regulations governing stablecoins are anticipated to impact the services cryptocurrency exchanges offer in the area by the month’s end. Currently, Binance, the leading cryptocurrency exchange, has stopped providing certain services to users in the region.
Earlier this week, the crypto exchange notified its users in the area that some services would no longer be accessible. According to reports, Binance had already prevented access to a few services, like copy trading, starting June 26.
The EBA is a supervisory authority of the European Union based in La Défense, Île-de-France. It performs stress assessments on European banks to make the European financial system more transparent and finds problems in financial institutions’ capital structures.
