News EBA issues new MiCA guidelines for crypto-asset regulation


The European Banking Authority (EBA) has released a comprehensive set of technical standards and guidelines under the Markets in Crypto-Assets (MiCA) regulation.

These guidelines aim to provide regulatory clarity for asset-referenced tokens (ARTs) and e-money tokens (EMTs) across the European Union. They address various aspects such as stress testing programs, asset reserves, and recovery plans. ARTs are backed by assets like commodities, real estate, or a portfolio of different assets, whereas EMTs maintain a stable value by being pegged to fiat currencies, similar to stablecoins.

Key provisions require token issuers to maintain sufficient financial resources (own funds) to mitigate potential risks. The EBA has established criteria for assessing higher-risk scenarios, necessitating increased reserves of own funds.

The EBA’s reports outline the process and timeline for issuers to adjust their own funds to at least 3% of the average reserve of significant assets, with an implementation plan due within 25 working days and full compliance mandated within six months.

Additionally, the guidelines mandate minimum percentages for asset reserves based on daily and weekly maturities and impose restrictions on issuers’ concentration of highly liquid financial instruments. Similar limits apply to tokens linked to non-official currencies like commodities or real estate.

Regarding recovery plans, the EBA incorporates consultation feedback to specify communication and disclosure requirements. It clarifies that certain exemptions under the legislation already exclude EMT issuers from specific asset reserve obligations. These guidelines are integral to the implementation of the MiCA regulation, with digital asset service providers required to adhere to the new standards by 1 July 2026.

Background on MiCA

The MiCA regulation, proposed by the European Parliament, aims to establish a comprehensive framework for crypto assets within the European Union (EU). This initiative addresses the previous lack of specific legislative coverage for these assets within the EU, providing clear and consistent legal regulations.

MiCA’s primary objectives are to enhance consumer and investor protection, promote financial stability and innovation, and support the adoption of crypto assets across the EU. The regulation categorizes crypto assets into three main types: asset-referenced tokens (ART), electronic money tokens (EMT), and other assets not previously covered by EU legislation.

Introduced in June 2023, MiCA is designed to be implemented in phases. Rules related to stablecoins are scheduled to take effect in June 2024, while the remaining regulatory provisions will be enforced starting December 2024, incorporating specific transitional measures.

In January 2024, the European Securities and Markets Authority (ESMA) published two consultation papers on guidelines under the Markets in Crypto-Assets Regulation.