European Commission Begins MiCA Review Due to Non-Viability of Stablecoins
The European Commission has launched consultations on revising the MiCA regulation. The reason is the absence of applications for issuing asset-referenced tokens (ARTs) over two years, which proved commercially unviable due to the ban on interest payments and high capital requirements.
Title: European Commission Revises MiCA: Why Asset-Referenced Stablecoins Were Stillborn
Author: Independent Crypto Analyst (Insider Perspective)
[The Gist]: What's Really Happening
On May 20, 2026, the European Commission launched a targeted consultation on revising the MiCA regulation. The formal reason is to assess the framework's effectiveness. The informal reason is an admission of failure: in two years of MiCA, no issuer has obtained a license to issue asset-referenced tokens (ARTs). Zero. Nothing.
Mainstream media write about "regulatory review" and "industry consultations." I'll put it differently: Brussels is quietly admitting that MiCA killed ARTs before they were born. The ban on paying interest to stablecoin holders, combined with capital requirements and the mandatory reserve of 30% of funds in bank deposits, made the ART business model economically unviable.
A key nuance missed by Cointelegraph and Reuters: the consultation covers 86 questions across four thematic blocks. The most painful one is the second block on stablecoins. The Commission is publicly asking for the first time: are capital requirements too high? Was the interest ban a mistake? Why haven't ARTs taken off, while EMTs (e-money tokens backed by a single fiat currency) have? By early 2026, 17 EMT issuers were licensed for 25 tokens (14 in euro, 9 in US dollars). And ARTs? Zero. This is no coincidence.
Timeline and Context
To understand the scale of the review, look at MiCA's timeline and current deadlines.
| Date | Event | Market Impact |
|---|---|---|
| June 29, 2023 | MiCA enters into force | Start of regulatory era |
| June 30, 2024 | Stablecoin rules become mandatory | ARTs and EMTs require licensing |
| December 30, 2024 | MiCA fully applicable | All CASPs must comply |
| March 31, 2025 | Non-MiCA-compliant EMTs banned from trading | USDT delisted from Coinbase, Binance, Crypto.com |
| February 2026 | Study published: 174 licensed CASPs, 0 licensed ARTs | Brussels sounds alarm |
| May 20, 2026 | European Commission launches targeted consultation | De facto admission of ART failure |
| June 30, 2026 | End of all transitional periods (grandfathering) | Final deadline for unlicensed CASPs |
| August 31, 2026 | Deadline for consultation responses | Industry feedback collection |
| June 30, 2027 | European Commission report to European Parliament | Possible emergence of "MiCA 2" |
Context is critical: the consultation is not just a "survey." It is the first step in the legislative process provided for by Article 140 of MiCA. The Commission must report by June 30, 2027. It is already clear that "MiCA 2" will differ significantly from the original. Questions about DeFi, staking, lending, NFTs, and tokenized deposits, which MiCA initially excluded, are now openly discussed.
Note the geopolitical context. The consultation explicitly acknowledges that the US, UK, Singapore, and other jurisdictions are developing their own frameworks, often more flexible and innovation-friendly than MiCA. Brussels fears capital and startup outflows. The race for the "crypto capital of the world" is intensifying.
Who Wins and Who Loses
Winners:
Circle (USDC, EURC). Circle became the first global stablecoin issuer to obtain MiCA compliance through its French subsidiary. USDC trades on all regulated European exchanges, while USDT does not. EURC market cap grew 300% in 2025. A MiCA revision could legalize "interest-bearing" stablecoins, giving Circle a new revenue stream.
Banks and traditional financial institutions. French Société Générale (via SG Forge) issues EURCV and USDCV. Banking Circle (Luxembourg) issues EURI. They are already in the game. Easing capital requirements and allowing interest would enable them to scale.
MiCA-compliant CASPs (Coinbase Luxembourg, Bitstamp, Kraken Ireland, etc.). There are 174 across Europe. Simplifying rules would reduce their compliance costs, currently estimated at $2-5 million per license.
Losers:
Tether (USDT). Tether publicly refused to seek a MiCA license, preferring "more risk-neutral jurisdictions." After March 31, 2025, USDT was delisted from all major European exchanges. USDT market cap in the eurozone collapsed from $15 billion to less than $1 billion. A MiCA revision toward tightening (unlikely) would be the final nail in Tether's coffin in Europe. Easing would give them hope, but Tether has already lost regulator trust.
Decentralized protocols operating on the regulatory edge. MiCA initially excluded "fully decentralized" services. But the consultation explicitly asks: should DeFi protocols, staking, and lending be regulated? The answer is likely "yes." Uniswap, Aave, and Lido in Europe may face new requirements. Their legal teams are already preparing consultation responses to argue they are "fully decentralized" — a concept MiCA does not define.
Issuers of asset-referenced tokens (ARTs). Formally, there are none. But those who planned (e.g., Libra, Facebook's original project) now must wait. Without changes to MiCA, the ART business model doesn't work. The consultation itself means ARTs will remain in limbo for the next 12-18 months. Investors won't fund a project with uncertain regulatory status.
What the Media Isn't Saying
The most important insight I see as an insider: the MiCA consultation is not an attempt to "save" ARTs, but a legitimization of the shift toward "interest-bearing stablecoins," which always existed but was banned.
The ban on paying interest on stablecoins in MiCA was a conscious choice. European regulators feared that "interest-bearing" stablecoins would become unregulated deposit products competing with banks. But practice showed: without interest, stablecoins are just "digital banknotes." They are held for transactions, not savings. Transactions need volume, and volume requires institutional money. Institutions won't come if their capital doesn't earn interest. The circle is closed.
Now the Commission openly asks: "should the ban on accruing interest on stablecoins be changed?" This is a signal. "MiCA 2" will likely allow interest, but under strict control — for example, through licensing as "electronic money with an investment function." This would open the floodgates: BlackRock, Fidelity, J.P. Morgan could issue their own stablecoins yielding returns from US Treasuries or Eurobonds. The tokenized real-world asset (RWA) market is currently $17 trillion by Citi estimates — just the beginning.
The second hidden factor is DeFi and staking. The consultation directly asks whether "staking, lending, and borrowing" should be regulated. The answer is obvious: yes. But the form of regulation is key. Will it be an "appendix" to MiCA (MiCA 2) or a separate regulation? Based on wording, the European Commission leans toward expanding MiCA rather than creating a new law. This means that by 2027-2028, the entire spectrum of DeFi activities in Europe will require licensing. For Lido, Rocket Pool, and Aave, this is a challenge: obtaining a staking license as a "service provider" rather than a "protocol."
Third: NFTs finally in focus. The consultation asks whether service providers related to NFTs should be regulated. The NFT market crashed from $17 billion in 2022 to $3-4 billion in 2026, but for regulators it's "big enough to ignore." I expect "MiCA 2" to include NFTs, but with thresholds — for example, "collectible" NFTs (art, gaming) remain unregulated, while "financial" NFTs (asset shares, tokenized real estate) fall under rules.
Forecast: Next 30 Days and 90 Days
30 days (to mid-July 2026):
- Bitcoin (BTC) and Ethereum (ETH): sideways. The MiCA consultation has no direct price impact but creates a positive backdrop for legal stablecoins (USDC, EURC). I expect a slight EURC market cap increase (+5%) from USDT outflows.
- Circle shares (if public via SPAC): up 2-3%. Circle is the main beneficiary of MiCA, and the consultation shows the European Commission won't break what works.
- RWA platform tokens (ONDO, CFG): correction of 5-10%. The market overestimated the speed of tokenization legalization in Europe. The consultation is good, but results take a year.
- Main risk: if the European Parliament takes a hard line and tightens MiCA (e.g., lowering the "significance" threshold for stablecoins from €5 billion to €1 billion), it would hit Circle and other issuers. But probability is low.
90 days (to mid-September 2026):
- Stablecoin market in Europe: market cap of MiCA-compliant stablecoins (USDC, EURC, EURI, EURCV) will grow 30-40%. By August 31, 2026, the deadline for consultation responses, lobbyists will push hard. Expect a series of public letters from Circle, Coinbase, Binance, and others demanding softer rules for ARTs and allowing interest.
- DeFi protocols (Aave, Uniswap, Lido): will start forming legal structures in Europe. Those unprepared may lose access to European users after 2027. I expect a 15-20% short-term drop in European user TVL, but long-term institutional capital growth.
- XRP: $1.05 – $1.25. MiCA is not directly related to XRP, but Ripple actively lobbies in Brussels to include XRP in a "whitelist" for cross-border payments. The consultation creates an opportunity.
- Main risk: if the EU decides to go the "Singapore way" — creating a separate, softer regime for DeFi and stablecoins, making MiCA 2 even more complex and drawn-out. But Brussels is not Singapore. Tightening is more likely than easing.
Editorial Forecast
Based on current data, a brief forecast for EURC/USD (market cap and demand) over the next 24–72 hours:
- Asset: EURC (Circle's euro stablecoin). Direction: moderate demand growth (+2% / +4% market cap).
- Key levels: current market cap ~$800 million, expected to rise to $850 million by week's end due to news flow. The consultation confirms MiCA remains the regulatory standard, and EURC is the main beneficiary.
- Confidence level: medium (55%). The consultation is a long-term positive, but short-term EURC demand is driven more by market movement and ECB rates than regulatory discussions.
- Main risk: if the European Central Bank announces a digital euro (CBDC) pilot, it could temporarily divert capital from private stablecoins. But the ECB is far from launch, so risk is low.
— Editorial Team
