The European Central Bank (ECB) has raised alarm to potential collapse from the United States’s aggressive support for the crypto industry, warning that an influx of dollar supported by stablecoins may ensure the European financial system.
According to In a paper policy seen by PoliticoThe ECB has requested for a revision of markets in the regulation of crypto-assets (MICA) regulatory framework for cryptocurrencies just months after it has been implemented.
In the midst of the dispute is the concern that US reforms, supported by President Donald Trump, can flood markets in Europe with dollar stablecoins denomination.
Fearing this ECB may be able to undergo a flight of European capital on US properties, overthrowing EU’s financial sovereignty and exposing banks to liquidity risks.
The ECB and European Commission are quarreling with MICA policies
While the ECB calls for lighter controls, the European Commission has removed these warnings as enlarged, each report.
The report, citing two diplomats and an EU officer, said Mica’s existing framework Stablecoin Transparency and Accountability for a better Ledger Economy (Stable) and The Guide and Establishment of National Innovation for US Stablecoins (Genius) Acts aimed at expanding the traces of American crypto.
“The commission is clear that they have different views on this topic,” and “not too many (countries) supported the idea that we should jump the gun and begin to make a quick change in (policies) based on the one -time,” one of the diplomats reportedly said in politico.
The stablecoin sector now regulates an appreciation of $ 234.151 billion, according to Data from coinmarketcap.
The ECB warns that European providers may face redemption pressure from the EU and foreign holders with no strict limitations, which potentially sparking a financial “run” and harmful to exposed institutions.
“The concern is warranted,” Mikko Ohtamaa, co-founder and CEO in the trading approach, said in a post on X. “However, the EU has the first advantage to Mover with regulation and they have stabbed it.”
Ohtamaa said that no EU Stablecoin is global competitive due to the restriction policies of MICA, which is influenced by lobbying in bank and legacy.
Related: US regulator, S FDIC and CFTC, Crypto restrictions are easy for banks, derivatives
Tether remains a major critic of Mica
Tether, who gave the world’s largest stablecoin, USDTIt has long been a major critic of EU’s MICA regulation.
Last year, CEO Paolo Ardoino defeated Mica’s requirements, especially the mandate for Stablecoin providers to hold at least 60% of EU bank accounts reserves, may introduce systematic risks to both stablecoins and the broader banking system.
Due to non -compliance with MICA, Tether’s USDT faced delistings from European major exchanges, including Coinbase, Crypto.comand Kraken.
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