tl;dr
The article argues that Europe is undermining its digital money potential by imposing heavy regulations and tariffs on stablecoins, a form of digital money that could significantly boost economic growth. Stablecoins, programmable digital cash on blockchains, enable fast, low-cost peer-to-peer paymen...
Europe’s regulatory framework, particularly the Market in Crypto-Assets regulation (MiCA), imposes restrictive and anti-competitive requirements on stablecoins, limiting their ability to drive GDP growth and innovation in digital money.
Stablecoins, programmable digital cash on blockchains, enable fast, low-cost peer-to-peer payments and open new opportunities for financial services. They can significantly enhance economic activity, such as enabling instant, inexpensive remittances or efficient capital raising by startups.
While the EU’s existing e-money framework supports digital cash, MiCA adds burdensome conditions, including mandating that stablecoin issuers safeguard a portion of funds with banks. This requirement creates costly barriers that favor traditional banks, contradicting aims of fair competition and hindering fintech innovation.
The article argues that these rules increase risk and expense for stablecoin issuers and propose removing blockchain-specific restrictions from MiCA. It advocates for granting e-money issuers direct access to European Central Bank payment and safeguarding systems, leveling the playing field with banks.
This approach would unleash the potential of stablecoins to boost Europe’s digital economy, fostering innovation, efficiency, and inclusion in financial services. Instead, current regulations threaten to sabotage Europe’s position in the evolving landscape of digital money.