EU unveils proposed regulations for complaint procedures concerning stablecoin issuers

The financial regulators of the European Union (EU) are looking to enhance regulations for stablecoins under the Markets in Crypto-Assets (MiCA) framework. They have recently released draft regulatory standards for stablecoin issuers to address complaints effectively.
The issued Regulatory Technical Standards (RTS) on March 13 outline the protocols for resolving complaints by asset reference token (ART) holders in a fair and efficient manner. These guidelines provide detailed procedures and standards for stablecoin issuers to manage complaints successfully.
According to a document from the European Banking Authority (EBA), this regulatory framework for stablecoins is the result of a collaborative effort between the EBA and the European Securities and Markets Authority (ESMA), the EU’s markets regulator. Both entities conducted consultations between July and October 2023.
The regulatory framework will be submitted to the European Commission for approval by the end of June. It will then undergo review by the European Parliament and the European Council before being published in the Official Journal of the European Union.
The MiCA regulatory framework categorizes stablecoins that can be linked to multiple fiat currencies or other assets as ARTs. This is different from stablecoins that are pegged solely to the value of a single currency.
Previously, the EU had been actively monitoring stablecoins through the MiCA regulation. The need for stablecoin oversight became more apparent after the collapse of Terra’s UST, which raised concerns about their potential systemic impact. The EBA had previously proposed regulations for stablecoin issuers.
Additionally, the MiCA legislation includes provisions for thorough screening of shareholders and board members of crypto asset service providers (CASPs). These rules aim to authorize CASPs while ensuring the separation of customer assets and trading to prevent commingling of customer and company funds.
The full implementation of the MiCA framework is expected by December, while the stablecoin regulations are scheduled to be launched in the summer. The MiCA legislation aims to establish a comprehensive framework for crypto issuers, service providers, and users.