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Europe’s regulatory approach to stablecoins under MiCA is stifling innovation and imposing unnecessary costs, argues Monerium co-founder Sveinn Valfells. By adding banking requirements to e-money issued onchain, the EU is creating unfair barriers that could hinder the potential GDP boost from digital currencies. The solution lies in simplifying regulations and granting e-money issuers equal access to ECB facilities.
- MiCA regulations require stablecoin issuers to safeguard 30% of funds with banks, creating an unfair advantage for traditional banks over fintechs.
- The ECB has begun leveling the playing field by granting non-bank fintechs access to payment systems, but should extend this to safeguarding facilities.
- Europe's existing e-money framework, established in 2000, already provides a proven model for digital cash that MiCA unnecessarily complicates for blockchain applications.
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