European Commission downplays stablecoin risks, counters ECB warning
The EU’s joint stablecoin issuance with third countries has risks, but they are manageable under the MiCA framework, the European Commission said.
The European Union’s main executive body has taken a soft approach toward stablecoins, contrasting with that of the European Central Bank (ECB) and sparking industry optimism.
In response to ECB concerns on potential bank run risks stemming from stablecoin multi-issuance in Europe and third countries, the European Commission (EC) said such risks are “highly unlikely.”
A spokesperson for the Commission told Cointelegraph, “Even in the highly unlikely event of a run on a jointly issued token, redemptions by foreign holders would primarily occur in jurisdictions like the US, where most tokens circulate and the bulk of reserves are held.”