ECB and EU Central Banks Propose Removing Stablecoin Bank Deposit Requirements

The European Central Bank (ECB) and other central banks within the European System of Central Banks (ESCB) have proposed removing the requirement for stablecoin issuers to hold a specific percentage of reserve assets in bank deposits. In their response to a consultation on MiCA, they argued that such deposits could destabilize bank funding structures. Instead, they suggested implementing minimum holding ratios for assets maturing within one and five business days. The central banks also expressed concerns regarding the execution of MiCA and supported the European Systemic Risk Board's (ESRB) stance against "multi-issuance" models for stablecoins.