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    Home»Crypto News»DeFi»EU Reviews Stablecoin Interest Ban in Potential MiCA Overhaul
    Cointelegraph
    DeFi

    EU Reviews Stablecoin Interest Ban in Potential MiCA Overhaul

    May 20, 20263 Mins Read
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    The European Commission has opened a review of its landmark crypto regulation, signaling that the European Union is considering updates to its landmark digital asset framework just two years after it took effect.

    The commission on Wednesday launched a public consultation seeking feedback from the crypto industry and the wider public on whether the EU’s Markets in Crypto-Assets Regulation (MiCA) should be updated. The consultation will remain open until Aug. 31.

    The commission said crypto markets and the global regulatory environment have “continued to evolve” since MiCA took effect in 2024, prompting officials to assess whether the current framework remains “fit for purpose.”

    The move marks an important regulatory development in the EU, with some industry observers already referring to potential future updates to the framework as “MiCA 2.”

    kraken

    Stablecoin interest ban included in regulatory review

    The targeted consultation under MiCA is a detailed questionnaire designed to assess how the regulation is functioning in practice and where adjustments may be needed.

    It seeks feedback on ongoing classification challenges, particularly the blurred boundary between crypto assets and traditional financial instruments under EU law, including wrapped tokens, synthetic assets and tokenized fund interests.

    A key focus is stablecoins, including a reassessment of MiCA’s prohibition on interest or interest-like remuneration. The commission is asking whether this restriction should be maintained or revised, alongside broader questions on reserve requirements, liquidity management, redemption rights and the thresholds used to determine “significant” tokens.

    An excerpt from the targeted consultation on the MiCA review. Source: EC

    Beyond stablecoins, the consultation also examines emerging risk areas, including decentralized finance (DeFi), staking, lending, non-fungible tokens, and crypto asset service providers (CASPs), as well as issues around market integrity, investor protection and potential simplification of compliance rules.

    Related: Euro stablecoin project Qivalis adds 25 banks ahead of launch

    The inclusion of DeFi and tokenized financial assets is particularly notable as both areas remain largely outside MiCA’s scope.

    EU probes whether consumers actually trust crypto

    The public consultation document shows the commission is not only reviewing whether MiCA works as a legal framework, but also whether ordinary consumers understand and trust digital assets under the new rules.

    Many of the questions focus on user awareness of Bitcoin (BTC), Ether (ETH), stablecoins, DeFi and tokenized assets.

    An excerpt from the public consultation on the MiCA review. Source: The EC

    It also explores what would increase consumer confidence in crypto services, including stronger protections, clearer rules, improved supervision and easier access through regulated banks and payment providers.

    The review comes as MiCA approaches a key transitional deadline in July 2026, after which CASPs must be fully authorized under the EU framework or cease operations.

    Magazine: How crypto laws changed in 2025 — and how they’ll change in 2026



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