EU’s Stablecoin Technical Standards To Be Launched By The End Of 2024

Key Points:

• The European Banking Authority (EBA) expects to finalize and publish technical standards for stablecoin issuers by the end of 2024.
• The stablecoin technical standards address authorization, stress testing, and transaction estimation under the MiCA.

The EBA expects to publish its technical standards in respect of stablecoin issuers in the EU Official Journal by the end of 2024, CoinDesk reports.

Read more: Circle Recommends European Banking Authority Adjust Its Crypto Regulatory Guidelines

EBA to Finalize Stablecoin Technical Standards by End of 2024

Under the wider framework for the crypto-asset markets, known as MiCA, these stablecoin technical standards are desired in an effort toward a comprehensive approach to the rapidly growing sector.

The EBA, along with the European Securities and Markets Authority, has also sent 15 stablecoin technical standards to the European Commission for endorsement. The stablecoin technical standards address key issues such as authorization, stress testing, and methods of estimation of volumes of transactions and values. While the stablecoin-specific regulations went live in June this year, the rest of the MiCA framework will only go fully live by December.

Stablecoin Technical Standards to be Reviewed by European Commission

The European Commission is currently reviewing the submitted stablecoin technical standards and will confirm whether these would be approved as submitted or if modifications would be called for. After approval by the Commission, the standards would face further scrutiny by the European Parliament and the European Council. They also have to be translated and adopted formally before they are published in the EU Official Journal, the official repository for EU legislative acts.

The EBA initially published draft guidance for public comment in July 2023. That was followed by the publication in March 2024 of a final draft of the regulatory technical standards developed jointly with ESMA. Once completed and published, these stablecoin technical standards will mark a critical development in the EU’s oversight of the new stablecoin sector, creating certainty that stablecoin issuers are subject to rigorous authorization and stress testing requirements.

The regulations under MiCA will, when fully implemented, give the green light to crypto companies across the EU’s 27-member states to operate with a single license, making life much easier and bringing much more regulatory clarity to the single market.