EU Central Banks Call for Scrapping MiCA’s Bank-Deposit Rule, Proposing Liquidity Thresholds for Stablecoin Reserves

The European Central Bank and the European System of Central Banks (ESCB) formally requested the European Commission on 22 September 2026 to remove MiCA’s rule requiring stablecoin issuers to hold a portion of reserves as bank deposits, according to the ESCB’s consultation response to the Commission’s review of the Markets in Crypto-Assets Regulation (MiCA).

Under the current framework, issuers of non-significant tokens must keep at least 30% of reserves in bank deposits, rising to 60% for tokens classified as significant. The ESCB argues the mandate “creates a direct link between issuers and credit institutions” and could expose banks to liquidity problems if a stablecoin run forces an issuer to rapidly withdraw deposits.

The central banks proposed replacing the percentage-based deposit requirements with liquidity thresholds, requiring reserve assets to mature within one to five working days. The ESCB pointed to overnight reverse repurchase agreements (repos) and short-term sovereign bonds as suitable instruments. The proposal references draft rules published by the European Banking Authority in 2024, which required significant stablecoins to hold at least 40% of reserves in assets maturing within one working day and 60% within five working days, with 20% and 30% thresholds respectively for non-significant tokens. The ESCB did not put specific percentages on its own proposal.

The ESCB cited the March 2023 collapse of Silicon Valley Bank, which triggered a run on Circle’s USDC after Circle disclosed $3.3 billion of reserves held at the bank, as an example of risks flowing from banks to stablecoins. Risks can also flow in the opposite direction, the central banks warned — a stablecoin run could force an issuer to rapidly withdraw deposits, creating liquidity problems for a bank, particularly if stablecoin reserves account for a significant share of its funding.

The ESCB’s argument echoes concerns raised by Tether CEO Paolo Ardoino since at least 2024. In an October 2024 interview, Ardoino illustrated the risk with a hypothetical stablecoin holding €10 billion in reserves, €6 billion of which would have to be kept in bank deposits. If a bank lent out 90% of those funds, only €600 million would remain available, potentially creating a liquidity crunch. Following the ESCB announcement, Ardoino posted on X: “Europe’s central banks want Brussels to delete a MiCA rule on stablecoin reserves. It forces large issuers to keep 60% of that money in commercial banks. Tether refused an EU license over the same clause.”

Beyond stablecoin reserves, the ESCB warned of “material challenges” enforcing MiCA, saying non-compliant crypto companies operating outside EU borders can still reach EU customers. Separately, according to Euronews, Europe’s central banks are also calling for a wider ban on interest payments on stablecoins, new powers to curb tokens pegged to foreign currencies such as the US dollar, and EU-level supervision of crypto firms.

The proposal would move the EU closer to the U.S. model under the GENIUS Act, which regulates stablecoin reserves without rigid deposit-percentage requirements. If adopted, the practical difference between the EU and U.S. rulebooks would narrow to maturity-based liquidity floors rather than where the money must sit, reducing divergence for issuers operating in both markets.

The ESCB’s response is a recommendation to the Commission’s MiCA review, not a change in law. Neither the ECB nor the Commission has given a timeline for adopting the recommendation. MiCA’s stablecoin provisions became fully applicable during 2024 and 2025, making Europe the first major jurisdiction with a full crypto-asset framework.