Crypto lobby urges EU to allow yield on euro stablecoins

Blockchain for Europe, a Brussels-based trade association backed by Coinbase, Ripple and Kraken, submitted draft amendments to the EU’s Markets in Crypto‑Assets regulation (MiCA) seeking to permit euro-denominated stablecoins to pay yield and to remove a €200 million-per-day transfer cap.

The association asked that euro electronic money tokens (EMTs) be allowed to offer remuneration on balances while remaining subject to strict liquidity and capital requirements. Under current MiCA text, Article 50 does not treat certain stablecoins as a store of value and bars remuneration on balances.

The group noted the stablecoin market exceeds $320 billion in supply and is heavily dollar-dominated, with about 99% of supply pegged to the U.S. dollar and roughly 0.22% denominated in euros. It highlighted that U.S. dollar tokens such as USDC and USDT have captured large shares of decentralized finance liquidity because many lending platforms and protocols offer yield on those tokens.

Blockchain for Europe proposed lifting the daily transfer cap and creating an innovation exemption for early-stage projects. The association argued those changes would help euro stablecoins attract liquidity and compete on similar terms to dollar-pegged tokens, while allowing private stablecoins to coexist with the planned Digital Euro central bank digital currency.

European authorities have raised financial-stability concerns. The European Central Bank has warned that broader permission for stablecoin yield could increase the risk of deposit outflows from banks. Blockchain for Europe acknowledged the need for strict rules on liquidity and capital adequacy but questioned the economic basis for a blanket ban on remuneration.

The group’s positions align with lobbying by some of its backers. Coinbase currently chairs the association’s board and has pushed for similar yield permissions in U.S. legislation. Blockchain for Europe also noted that proposed U.S. measures would limit direct yield on U.S. stablecoins, which could affect competitive dynamics if European rules differ.

Euro-denominated stablecoins have shown growth since MiCA entered into force, but market share remains small compared with U.S. dollar tokens. It remains undecided whether EU lawmakers and regulators will accept the proposed amendments, and debate is expected to weigh competition and innovation against risks to bank deposits and financial stability.