Europe’s central banks want lawmakers to close routes that can turn stablecoins into yield-bearing products even when issuers do not pay interest directly. In a formal response to the European Commission’s review of the Markets in Crypto-Assets Regulation, the European System of Central Banks argued that MiCA’s prohibition on stablecoin remuneration should remain and should reach arrangements that reproduce the same economic result.
The 57-page consultation response is a policy recommendation, not a new rule. Any amendment to MiCA would still require the EU legislative process. That boundary matters because the document sets out the central banks’ preferred direction without changing what stablecoin issuers or crypto service providers must do today.
Indirect rewards are the main target
The ESCB says enforcement should cover attempts to route remuneration through third parties. Its examples include rewards, fee reductions and bundled services. It also points to lending, borrowing and staking products that can convert a stablecoin balance into a return through a separate service.
Under that approach, regulators would examine the economic substance of an arrangement rather than its label. A platform could not avoid the policy merely by separating token issuance from the service that generates a return. The response also recommends EU-level rules for crypto lending, borrowing and staking, with different treatment for agency services, investment services and banking-type activity.
Reserve rules could shift from deposits to maturity
The central banks pair the tougher position on yield with a proposed change to stablecoin reserve requirements. MiCA currently requires at least 30% of reserve assets, or 60% for significant tokens, to be held as deposits at credit institutions. The ESCB says fixed deposit shares can tie an issuer’s liquidity risk to the banks holding those deposits and could amplify stress if a large redemption wave forces rapid withdrawals.
Its alternative would remove the predefined bank-deposit percentages and set minimum daily and weekly liquidity buckets. The response cites draft standards that use assets maturing within one working day and five working days as a starting point. Those standards set daily floors of 20% for non-significant tokens and 40% for significant tokens, with weekly floors of 30% and 60%, respectively. The ESCB says calibration needs further assessment, so these figures should be read as a proposed starting point rather than a settled replacement.
What the proposal would change
If lawmakers adopt this direction, stablecoin policy would focus more closely on how rewards are delivered and how quickly reserves become available for redemption. Product teams would need to assess connected lending, staking and loyalty programs alongside the token itself. Reserve managers, meanwhile, could face maturity-based tests instead of a single minimum allocation to bank deposits.
The document also supports moving authorization, monitoring and enforcement for crypto-asset service providers to the European Securities and Markets Authority. For now, however, all of these points remain recommendations submitted during a consultation. The next meaningful signal will be whether the Commission carries them into a legislative proposal and how lawmakers define indirect remuneration without capturing services that do not function as interest.
Adapted from European Central Banks Push to Widen Stablecoin Yield Ban.