CoinDesk
Europe's Markets in Crypto Assets regulation, MiCA, took three years to write and another three to look out of date. The European Commission has opened a review, informally dubbed MiCA 2.0, with a consultation that closes around September, and the core tension is that MiCA was drafted for spot crypto at a moment when stablecoins and tokenization have since eaten the wholesale finance agenda.
The scale of that gap is hard to overstate. Dollar-denominated tokens now account for $310 billion of the $311 billion global stablecoin market, with non-dollar issuers below 0.5% by DeFiLlama's count. The U.S. last year passed the GENIUS Act, defining stablecoin payments and assigning the Federal Reserve and the Office of the Comptroller of the Currency oversight of issuers. Europe is now rewriting in a market the U.S. has already legitimized.
Why it matters
The structural split is reserve treatment. GENIUS lets issuers hold reserves in U.S. government debt; MiCA forces stablecoin deposits back into the banking system. The Commission is now weighing whether to permit a GENIUS-style model, where a euro stablecoin operator buys money market instruments from European governments instead of routing funds through banks. John Orchard, chairman of the Digital Monetary Institute at OMFIF, said the Commission is "toying with the idea" of that pivot.
The geopolitical subtext is dollar dominance. Dollar stablecoins at $310B versus non-dollar under 0.5% is the gap Europe's policymakers are trying to close. A consortium of European banks under the Qivalis banner is building a euro-denominated stablecoin whose members can satisfy reserve requirements internally. The catch: Europe lacks a unified treasury bond market equivalent to U.S. T-bills, which is why a synthetic European safe asset built from money market instruments is back on the table.
Market impact
Multi-issuance models are the other flashpoint. Circle Internet's USDC, listed under ticker CRCL, can be minted by distinct legal entities across jurisdictions while staying fungible to users.
Frequently asked questions
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What is MiCA 2.0?
A formal review of the EU's Markets in Crypto Assets regulation, opened three years after MiCA took effect. The Commission is running a consultation that closes around September to update the regime for stablecoins, tokenization, and multi-issuance models.
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Why does MiCA need a rethink after only three years?
MiCA was drafted for spot crypto. Stablecoins and tokenization have since dominated institutional and wholesale flows, with dollar-pegged tokens now holding $310B of a $311B market, leaving the original framework structurally behind.
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How does MiCA differ from the U.S. GENIUS Act on stablecoin reserves?
GENIUS lets issuers hold reserves in U.S. government debt. MiCA forces stablecoin deposits back into the banking system. The MiCA 2.0 review is weighing whether to permit a GENIUS-style model for euro issuers.
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What is Qivalis and why does it matter for euro stablecoins?
Qivalis is a consortium of European banks building a euro-denominated stablecoin. Because its members are banks, they can satisfy reserve requirements internally, and the project is positioned as a strategic response to U.S. dollar dominance in stablecoins.
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Could MiCA supervision move from national regulators to ESMA?
The review is weighing consolidation of MiCA supervision under ESMA instead of National Competent Authorities like Germany's Bafin. Proponents cite reduced national discrepancies; critics warn of bureaucracy around a still-nascent industry.
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