A recent report reveals that the European Central Bank is pushing for amendments to the European Union's Markets in Crypto Assets (MiCA) legislation, citing fears that US backing for cryptocurrency could have detrimental effects on the EU's financial stability. This move has put the bank at odds with the European Commission. The ECB's concerns stem from impending US legislation, such as the Stablecoin Transparency and Accountability for a Better Ledger Economy Act and the Guiding and Establishing National Innovation for US Stablecoins Act, which could further boost the influence of dollar-backed stablecoins.
According to a forecast by Standard Chartered, the stablecoin sector could experience a tenfold increase, reaching $2 trillion within three years if the legislation passes. The ECB's proposal to revise MiCA was met with resistance during a meeting with top EU government officials, where the Commission argued that it was premature to assess the impact of the US crypto environment on EU financial stability.
The Commission also stated that the risks associated with global stablecoins are manageable within the existing legal framework, as only one global stablecoin has been authorized under the new rules.