MiCA

MiCA was adopted in May 2023 with a phased implementation: provisions applying to stablecoin issuers (ARTs and EMTs) took effect from June 2024; the full framework including crypto-asset service providers (CASPs) became applicable from December 2024.

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MiCA creates two categories of fiat-pegged tokens relevant to payments. An e-money token (EMT) is a token pegged to a single fiat currency, such as a euro-denominated or dollar-denominated stablecoin. EMT issuers must be authorised as a credit institution or an electronic money institution (EMI) under EU rules, must back the EMT one-to-one with high-quality liquid assets, and must honour redemption requests at par at any time. An asset-referenced token (ART) is pegged to a basket of currencies or other assets and faces stricter requirements including minimum own funds, reserve management rules, and operational risk standards.

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For CASPs, exchanges, wallet providers, trading platforms, payment services using crypto-assets, MiCA requires authorisation by a national competent authority in any EU member state, with passporting rights to operate across the EU. Key CASP obligations include market abuse prevention, conflict of interest management, safeguarding client assets, and transparent fee disclosure.

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Issuers of significant EMTs (which meet size thresholds such as more than €5 billion in issuance, more than 10 million holders, or more than 2.5 million transactions and €500 million in value per day) face additional supervisory requirements, including direct oversight by the European Banking Authority (EBA) rather than their home member state regulator.

MiCA provides the regulatory clarity that institutional adoption of payment stablecoins in the EU has required. Before MiCA, the applicable regulatory framework for stablecoin issuers was ambiguous, some jurisdictions applied e-money regulation, others applied no framework, creating compliance uncertainty and legal risk for issuers and merchants accepting stablecoins. MiCA resolves this by establishing a single, harmonised framework.

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For merchants and payment providers considering stablecoin acceptance in the EU, MiCA provides a standard for evaluating counterparty compliance: an EMT issuer authorised under MiCA has demonstrated reserve adequacy, redemption capability, and regulatory oversight. Accepting payments in MiCA-compliant EMTs carries materially different risk than accepting unregulated stablecoins.

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MiCA also has global influence. As the most comprehensive crypto-asset regulatory framework enacted to date, it is being studied by regulators worldwide as a model. The GENIUS Act in the US shares conceptual similarities with MiCA's EMT framework, suggesting convergence in global stablecoin regulation.