The European Commission is currently investigating how EU regulations on crypto assets protect investors' redemption rights in identical e-money tokens (EMTs) pegged to a single official currency. Last year, France's banking and insurance supervisor, the Autorité de contrôle prudentiel et de résolution (ACPR), queried the European Banking Authority about the feasibility of issuing technically identical and fully interchangeable EMTs by entities within and outside the EU.
The matter was then referred from the EBA to the EU Commission for interpretation of EU law. In 2023, the EU introduced comprehensive regulations for crypto assets, called MiCAR, stipulating that EMT issuers must obtain regulatory approval and maintain reserves, possibly as bank deposits, to ensure the ability to repay investors when necessary.
Meanwhile, in the United States, President Donald Trump pledged to reduce the regulatory constraints on cryptocurrency companies, with the U.S. Securities and Exchange Commission forming a task force to develop new regulations.
There are issuers that operate in and out of the EU. For instance, Circle issues 'USDC,' the world's second-largest stablecoin by market value, pegged to the U.S. dollar, through its EU entity, Circle SAS, and its U.S. entity, Circle LLC.
ACPR also inquired about the possibility of limiting redemption requests to the EU-based entity for identical EMTs issued within and outside the EU, without providing further details. Andrea Resti, a finance professor at Bocconi University in Milan, emphasized the importance of adhering to the clarity and flexibility outlined in the MiCA regulations to avoid potential risks and maintain the efficacy of the rules.