EU to Treat Same-brand Stablecoins as Interchangeable Tokens

The European Commission is poised to release new regulatory guidelines for stablecoins within days, addressing growing demand for clarity on cross-border operations. The MOVE comes despite opposition from the European Central Bank, which fears EU reserves could be used to fund redemption requests from outside the bloc.

Under the forthcoming rules, stablecoins issued by licensed entities outside the EU will be treated as equivalent to those issued within the union when bearing the same brand. This resolves lingering ambiguity about token fungibility under the Markets in Crypto-Assets framework, which currently requires issuers to maintain EU-based reserves but lacked provisions for cross-jurisdictional recognition.

The clarification follows a formal query from France's banking regulator in April regarding dual-issued stablecoins. Issuers must still match EU token volumes with corresponding EU reserves, maintaining the MiCA framework's Core safeguards while enabling smoother cross-border functionality for compliant operators.