Report: MiCA is expected to become the basis for global stablecoin regulation

The Digital Euro Association has published a report analyzing the impact of Europe's MiCA regulations on stablecoin issuance. The report states that MiCA is expected to become the basis for global stablecoin regulation, but also proposes improvements. The report recommends the establishment of a global body similar to the Basel Committee to unify stablecoin standards and gain insights from the implementation of MiCA. The report criticizes MiCA's strict regulations, such as requiring ordinary stablecoins and important stablecoins to hold 30% and 60% reserves respectively, which affects profitability and increases credit risk. The collapse of Silicon Valley Bank, which led to the decoupling of Circle's USDC, is an example. The report also discusses the ambiguity of anti-money laundering (AML) regulations and believes that further clarification is needed. In addition, international stablecoin issuers face challenges in complying with MiCAR, such as hiring EU-authorized custodians and addressing the complexity of dual issuance structures. The report disagrees with MiCA's scale restrictions on the use of foreign currency electronic money tokens in the EU, arguing that this may weaken the USD/EUR trading pair, but this is not the case. Overall, the report lists many gray areas and topics that need to be considered in the EU and elsewhere.