The banking watchdog for the European Union asked stablecoin issuers on Wednesday to voluntarily follow certain “guiding principles” on risk management and consumer protection.
The world’s first comprehensive set of regulations for trading cryptoassets like bitcoin and ether as well as issuing stablecoins, a type of cryptoasset backed by a currency or asset, were authorised by the EU in April.
The European Banking Authority released its first set of measures on Wednesday for input from the general public in order to clarify the MiCAR requirements for the issuance of a stablecoin that would take effect on June 30, 2024.
They contain clauses like a perpetual right of redemption and guidelines for managing complaints.
“The statement is intended to encourage timely preparatory actions to MiCAR application, with the objectives to reduce the risks of potentially disruptive and sharp business model adjustments at a later stage, to foster supervisory convergence, and to facilitate the protection of consumers,” the EBA said in a statement.
Separately, the European Securities and Markets Authority of the EU published proposed regulations for companies that trade cryptocurrencies, or so-called “crypto asset service providers.”
Applying lessons from incidents like the demise of American cryptocurrency exchange FTX, the proposed guidelines for public consultation seek to authorise CASPs, ensure separation of customer cryptoassets and trading, and prevent “co-mingling” of corporate and customer funds.
The ESMA regulations won’t have a compensation plan for customers who lose money on investments in unbacked cryptoassets when they go into effect in January 2025.
