MiCA

📅 November 1 | Brussels, European Union
Europe celebrated the arrival of MiCA (Markets in Crypto-Assets) as the continent's great regulatory shield. But now, a new opinion published by CoinDesk raises a disturbing warning: the much-lauded law could be incubating the next stablecoin crisis. Instead of strengthening financial stability, MiCA—according to several experts—could concentrate risk and stifle innovation, creating exactly the scenario it sought to avoid.

📖 The MiCA framework officially came into effect this year, establishing strict rules for stablecoin issuers and crypto-asset platforms across the European Union.
However, its practical application is favoring a few financial giants, while excluding smaller issuers and decentralized projects unable to meet the capital, audit, and custody requirements.
CoinDesk argues that this concentration could trigger a domino effect:
Less competition → greater dependence on large issuers.More regulation → less innovation and market resilience.Excessive compliance → lower liquidity and greater vulnerability to shocks.
“MiCA seeks to protect the consumer, but in doing so, it is creating an ecosystem dominated by a few,” the author wrote, warning that a failure in a single issuer could drag down the entire European system.
Stablecoins like EURe or Circle EURC are emerging as the main beneficiaries of this regulated environment.
But, according to analysts, the enormous power concentrated in a few entities could generate a systemic vulnerability similar to that experienced by banks before 2008. Furthermore, compliance with MiCA imposes costs and registration times that are driving DeFi startups and protocols away from Europe.
While European regulators defend the law as a “global benchmark” for the digital financial order, critics warn of its rigidity.
Some analysts even suggest that MiCA could become a “moral hazard experiment”, where regulated actors assume the state will bail them out in case of crisis, which would encourage riskier behavior.
“The problem isn’t regulation, but regulation designed as if stablecoins were banks, when in reality they are hybrid infrastructures”.

Topic Opinion:
MiCA is a necessary step forward, but its implementation suffers from excessive centralization. Europe risks turning its crypto ecosystem into an oligopoly of stablebanks, controlled by the very actors that the blockchain system was intended to overcome. Stability is not achieved through more bureaucracy, but through diversity, transparency, and fair competition.
💬 Do you think MiCA will be the salvation or the historic mistake of crypto in Europe?

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#MiCA #Stablecoins #Europe #Circle #CryptoNews $USDC

When I first read about the Markets in Crypto‑Assets Regulation (MiCA) I felt a surge of cautious optimism. Here was the European Union setting a global benchmark for crypto-asset regulation, for stablecoins included, offering legal clarity, disclosure requirements and a veneer of order to what had been a wild frontier. It promised to tame chaos. But after digging deeper I realised something far more subtle and far more uneasy is unfolding. The very structure of MiCA assumes that backing assets equals stability, that transparent reserves equals safe money. It does not. And by gilding stablecoins with legitimacy while leaving macro-fragility unaddressed, MiCA may be quietly building the next crisis rather than preventing it.

MiCA merits credit. It forces issuers of e-money tokens (EMTs) and asset-referenced tokens (ARTs) to maintain full or near-full reserves, publish white-papers, undergo audits, and obtain authorisation if they want to operate in the EU. On paper, stablecoins can no longer be wildcat liabilities created without accountability. They are in scope. They are supervised. And that matters. The regulatory vacuum is being filled. The era of “issue any token, hope for the best” is ending. That is good.

But the problem lies in what MiCA does not do—or does only partially—and what it assumes. The assumption is this: if a stablecoin issuer holds the right reserves, demonstrates transparency and is licensed, then the token is stable, safe, financially sound. In other words, proof-of-reserves = proof-of-stability. That logic is baked into the architecture. The result is that once a coin is compliant, it is treated as close to safe money. That is the slippery slope. Because real stability in money is not just about backing; it is about liquidity under stress, maturity transformation risk, redemption risk, the relationship to traditional financial institutions, and systemic entanglement. MiCA touches some of this, but not nearly enough.

Take the redemption challenge. A fully backed stablecoin still faces the possibility of a run. Suppose holders believe something is off—or simply synchronized redemptions sweep across the network. Even if the reserves exist, a rapid fire-sale of underlying assets (say government bonds or short-term bills) may trigger losses, or force issuers to sell at a discount. As the Bank for International Settlements has warned, stablecoins increasingly resemble bank deposits in behaviour yet lack the protections of deposit insurance or a lender of last resort. And crucially, MiCA does not require the same macro-backstops you find in banking regulation: large-scale issuance limits, mandatory liquidity facilities, resolution frameworks, or structural separation of issuance from risky maturity profiles. It regulates each issuer, but it does not treat stablecoins as part of the broader money supply that could melt down the system.

Then there is the arbitrage problem. MiCA regulates issuers within the EU with strict rules. But what about stablecoins issued outside the EU or jointly across jurisdictions? Here the regulation gets fuzzy. When a global issuer issues the same token inside and outside the EU, fungible across borders, the safeguards of MiCA may not map neatly onto the legal structure of offshore reserves and non-EU entities. As the analysis from the Centre for European Policy Studies (CEPS) notes, multi-issuance stablecoins (the same token issued by different legal entities across jurisdictions) pose a credibility test. One respected economist warned the EU may become the residual guarantor of liabilities it cannot control. In effect, risk doesn’t disappear; it relocates beyond the regulator’s reach.

In many ways, MiCA is recreating the shadow-banking architecture of old: money-like instruments, issued by non-banks, circulating globally, lightly supervised but deeply connected to the banking system and government bond markets. The parallels are uncomfortable. Banks issue deposits; here issuers issue stablecoins. Banks hold reserves and face runs; here stablecoins hold backing and could face redemptions. But stablecoins avoid many of the rules banks face. They are treated as crypto assets, not as part of the banking system—even when they behave like money. The transformation is hybrid: DeFi meets TradFi. And hybridity is harder to regulate than pure forms.

MiCA’s framework shows evidences of this risk. For example, it prohibits interest or remuneration paid by the issuer to stablecoin holders, in order to avoid direct competition with banks and reduce deposit-run dynamics. But that alone doesn’t eliminate the behavioral risk of holders treating these tokens like deposits. The moment users expect unwavering redemption, instant transfers, and the utility of bank deposits, the model is vulnerable. And when redemption becomes large and simultaneous, the backing matters less than the speed of redemption and the liquidity of the backing. MiCA emphasises backing tokens, but it does not require the full architecture of banking stability: such as deep liquidity pools, structural separation of risky assets, or the ability for the issuer/regulator to step in as lender of last resort.

Moreover, stablecoins live in a global ecosystem. The EU may require reserves held in European depositaries and banks, but an issuer could choose foreign custody, foreign issuance, foreign legal entity. MiCA’s domestic controls may be sound, but with cross-border fungible tokens the reach of regulators becomes weak. The risk of regulatory arbitrage is high. The EU did recognise this and the European Central Bank recently urged the EU to demand equivalence for non-EU stablecoin issuers to avoid redemptions concentrating in the EU and draining reserves. In other words, the clues are right there: MiCA has built legitimacy for stablecoins, but has not yet built containment structures.

The irony is that in giving stablecoins legal recognition and framework, MiCA may accelerate their scale. Issuers seeking to star­t up will now aim for MiCA-compliance, market participants will trust those tokens more, adoption will broaden. That is the reward MiCA offers: legitimacy. But scaling legitimacy without system-wide safeguards is exactly what creates fragility. It’s like giving a new form of money the diary of a bank deposit without the chapter on what happens when the bank fails. You get confidence, you get size, but you leave the structure brittle.

The mixed reality is that the stablecoin market is already growing far faster than policy can adapt. As the BIS blog noted, stablecoins have gone from niche to entwined with traditional finance—settlement, payments, cross-border flows. The tools for supervision are patchwork. Macro-prudential oversight is underdeveloped. System-wide stress testing is largely absent. And the linkages between stablecoins, commercial banks, sovereign debt, and global payments networks mean a crisis in stablecoins could ripple into the broader system.

So where does this leave us? We must recognise MiCA for what it is: an important milestone, a first step, but not a shield. If we treat it as a guarantee of stablecoin safety, we will be disappointed—and potentially in trouble. The regulation legitimises stablecoins, but it does not guarantee stability. It fills some of the regulatory vacuum, but it leaves a lot of the structural risk unaddressed. The architecture of safe money is more than reserves, more than audits. It is about monitors, about stress scenarios, about liquidity, about resolution, about global coordination.

The Europe-wide context also adds urgency. If stablecoins grow in issuance and use, and EU consumers and institutions adopt them en masse, while issuance is partially outside EU jurisdiction or liquidity resides abroad, then in the event of stress the EU may face redemptions it cannot meet. The boxes are ticked, the rules are written, but the systemic wiring remains loose. The ones who issue these tokens may become too big to fail—but not too regulated to bail out. The shadow-money framework will only become visible when it breaks.

In closing, #MiCA is a paradox. It is both the answer and the question, the solution and the vulnerability. By formalising stablecoins it invites them into the mainstream; by focusing on issuer conduct it risks ignoring system-wide impact; by asserting oversight it may accelerate global arbitrage. In short, MiCA may not stop the next stablecoin crisis—it might quietly be building it. And in a world where trust runs on credibility and speed, we need more than rules: we need resilience.

$USDC
¡EL BANCO QUE DIO EL SALTO! La integración de ClearBank a la red de pagos de Circle es, en realidad, el momento en que las finanzas europeas levantan la bandera blanca ante la revolución digital. No se trata de una simple colaboración; es la admisión práctica de que los bancos no pueden vencer a las stablecoins, sino que deben adoptarlas para sobrevivir.
ClearBank, un pionero regulado, optó por aliarse con USDC y EURC en lugar de seguir luchando para lanzar su propia moneda digital frente a gigantes como el Banco de Inglaterra. La lección es clara: ante las altas barreras de entrada regulatorias, el camino más rápido a la eficiencia es subirse al tren de la infraestructura ya establecida y aprobada.
La clave de este cambio radical está en MiCA, la nueva ley europea. Al estar certificadas bajo esta norma, las stablecoins de Circle se convierten en el carril rápido y seguro para el dinero institucional. ClearBank no solo busca velocidad, sino también la tranquilidad regulatoria que le permite a sus clientes mover capital con confianza.
El resultado es la aniquilación de la ineficiencia, las transferencias transfronterizas europeas, históricamente lentas y costosas debido a la cadena de bancos intermediarios, están ahora destinadas a ser casi instantáneas y radicalmente baratas. Además, esta alianza sienta las bases para que las grandes empresas gestionen su efectivo (tesorería) y liquiden activos digitales de forma inmediata, haciendo que los sistemas bancarios tradicionales parezcan reliquias de otra era.
En esencia, la decisión de ClearBank no solo valida a las stablecoins como el futuro del dinero, sino que acelera el reloj para que toda la banca tradicional se adapte o se quede atrás.
🖇️ Si la eficiencia y la seguridad regulatoria de las stablecoins están forzando a los bancos a adoptar esta tecnología, ¿aceptará finalmente la banca central europea que las monedas privadas reguladas son una solución de pago superior y más rápida que el tan anunciado, pero aún ausente, Euro Digital (CBDC)?
🔍Si este análisis te despertó el chip de la innovación, ¡déjanos un Me Gusta y únete a la conversación! ❤️
#MiCA