EBA urges EU to bring crypto lending under MiCA review

The European Banking Authority has urged the European Commission to consider bringing crypto lending under MiCA as part of its review of the European Union’s digital asset regulatory framework.

The recommendation includes cases where crypto asset service providers give customers access to decentralized lending protocols. The EBA said the sector can pose risks to consumers that are not fully addressed under the existing framework.

The regulator also called for stronger rules covering third country multi issuer stablecoin arrangements. While it considers existing requirements for asset referenced tokens and electronic money tokens broadly appropriate, the EBA said these structures can create significant risks and may require changes to MiCA.

Reserve requirements for stablecoin issuers should also be reviewed, particularly rules governing the minimum share of reserves that must be held as bank deposits, while maintaining effective risk management.

The EBA separately identified crypto asset classification as a major challenge. It said unclear boundaries between MiCA and other EU financial rules can create unnecessary costs and delays for companies launching products, and recommended clearer definitions and scope.

The regulator also wants the reporting framework for token issuers and crypto service providers reviewed to improve supervision and risk monitoring.

MiCA entered into full application in December 2024, while its stablecoin provisions took effect six months earlier. As of September 1, 39 electronic money tokens had been issued under the framework, while no asset referenced tokens had been authorized, according to the EBA.

The recommendations come as the European Commission conducts a broader review of MiCA to determine whether the rules remain fit for purpose as the crypto market develops. Its targeted consultation remains open through September 30 and could ultimately lead to legislative changes.