What You Should Know:

• The European Central Bank (ECB) is advocating for modifications to the EU’s Markets in Crypto Assets (MiCA) legislation, expressing worries that U.S. support for cryptocurrencies could jeopardize financial stability in the European Union, as reported by Politico.
• The ECB’s stance is at odds with the European Commission, which believes it is premature to reevaluate the regulatory framework based on concerns about the U.S. crypto environment.

The ECB is urging a revision of the MiCA framework, which officially came into force last year, as they fear the burgeoning influence of U.S. stablecoins could cause economic instability within the 27-member bloc. A recent document circulated included views that suggest a change is necessary, although not all EU nations concur with this viewpoint.

The Commission maintains that there is insufficient evidence to affirm the U.S.’s crypto market’s potential impact on the EU’s financial landscape. They have authorized only one stablecoin under the new rules so far, leading them to deem the risks linked to global stablecoins manageable.

“The risks arising from such global stablecoins seem to be overstated and are manageable under the existing legal framework,” the Commission stated in a meeting document.

Read More: EU’s Restrictive Stablecoin Rules Take Effect Soon and Issuers Are Running Out of Time

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