The European Commission’s MiCA review is moving beyond technical cleanup and into questions that could reshape the EU’s crypto market. With responses due by September 30, the debate is increa
The European Commission’s MiCA review is moving beyond technical cleanup and into questions that could reshape the EU’s crypto market. With responses due by September 30, the debate is increasingly about where Europe’s regulatory perimeter should end, and whether stricter rules risk pushing activity toward faster-moving jurisdictions.
On May 20, the European Commission opened its targeted MiCA review consultation. The response deadline, originally August 31, has since been extended to September 30.
Article 140 of MiCA requires Brussels to report to the European Parliament and Council by June 30, 2027 on how the regulation is working. That report can be accompanied by a legislative proposal if the evidence points to changes.
“MiCA 2.0” is not the Commission’s legal name for the process. The phrase has instead become shorthand for the argument taking shape around the review: whether Europe needs targeted corrections or a broader package covering markets and services that MiCA left outside its scope or addressed only partially.
The timing gives policymakers something they did not have when the original framework was negotiated: experience with MiCA in operation. The maximum grandfathering period for existing crypto-asset service providers expired on July 1, although Member States were allowed to shorten it. Licensing, compliance and market experience can now be used to assess how the rules work in practice.
Regulatory Perimeter Comparison: MiCA vs. Emerging FrameworksHow key digital asset sectors are handled under current EU rules versus evolving global standards.
Sector / ActivityCurrent MiCA TreatmentKey Review / Global Pressure PointGlobal StablecoinsStrict issuer reserve & redemption rules; ban on non-compliant tokens (e.g., USDT).Cross-border multi-issuer risks & US GENIUS Act equivalence competition.DeFi ProtocolsLargely excluded due to lack of an identifiable traditional issuer/intermediary.Consultation explores whether to incorporate decentralized architectures.Staking & LendingPartial coverage (staking restricted mostly when tied directly to custody services).Review evaluating dedicated provisions to harmonize cross-border yield products.NFTs & CollectiblesExempted if genuinely unique and non-fungible (though large series can be reclassified).Re-evaluating platform/service provider obligations around digital art markets.Tokenised FinanceSplit across banking deposits, traditional securities rules, and e-money tokens.Blurring lines between payment rails, securities, and on-chain infrastructure.MiCA has already changed which stablecoins European customers can trade. ESMA told national regulators in early 2025 to ensure CASPs stopped providing certain services involving non-compliant asset-referenced and e-money tokens. Kraken subsequently removed USDT and several other stablecoins from trading for EEA clients.
Cross-border issuance now presents a harder problem.
A global stablecoin can involve an EU-regulated issuer alongside an issuer outside the bloc, with fungible tokens circulating across both markets. To token holders, the assets may appear identical even though different companies, reserve pools and legal jurisdictions sit behind them.
The distinction becomes important during heavy redemptions. If holders outside Europe can effectively draw on an EU issuer while part of the wider reserve pool remains beyond EU control, liquidity pressure created elsewhere could reach the European entity.
The European Systemic Risk Board has warned about multi-issuer structures, including risks around reserve availability, regulatory arbitrage and cross-border redemptions.
One option under discussion is an equivalence regime. Qualifying issuers from third countries could gain access to Europe while meeting conditions covering reserves, redemption rights and cooperation between regulators.
The US is developing its own version of that approach, giving Europe a live comparison as it considers what comes next.
The US enacted the GENIUS Act on July 18, 2025, creating a path for foreign stablecoin issuers that can satisfy American regulatory requirements.
Under the final GENIUS Act, a foreign issuer can access the US market if its home regulatory regime is found comparable to the American framework and it meets additional US conditions. These include registration with the Office of the Comptroller of the Currency and, unless a reciprocal arrangement provides otherwise, enough reserves at a US financial institution to meet liquidity demands from US customers.
Those requirements become especially important from July 18, 2028. Treasury’s implementation notice explains that digital-asset service providers will generally be unable to offer a stablecoin to US customers unless it comes from a permitted US issuer or a qualifying foreign issuer.
The economic objective reaches beyond market supervision. When the GENIUS Act was signed, US Treasury Secretary Scott Bessent tied the legislation directly to “dollar supremacy”.
That matters for Europe because dollar stablecoins already hold the deepest liquidity across global crypto markets. As we examined following the IMF’s warning that local stablecoins could accelerate dollarization, putting domestic and dollar-denominated tokens on the same infrastructure can make it easier for capital to move into digital dollars.
European policymakers therefore face a practical trade-off. Safeguards around reserves and redemption remain central to MiCA, but rules that make access substantially harder than in competing markets could shift liquidity and stablecoin activity elsewhere.
Public Consultation Deadline (Sept 30) May – Sept 2026 Commission Review & Draft Proposal Mid–2027 Potential New Rules Take Effect Awaiting legislative conclusion 2028+The targeted consultation also asks for feedback on DeFi, staking, lending and borrowing, along with other activities that do not fit neatly within the current framework.
Several of these omissions were deliberate when MiCA was written.
Crypto-asset lending and borrowing are not covered by the regulation, leaving national law in place while the EU considered whether a common regime was necessary. DeFi presents a different challenge because much of MiCA was designed around identifiable issuers and service providers. Protocols operating without a conventional intermediary can be difficult to address through the same rules.
Staking already intersects with MiCA in some circumstances, particularly where a service involves custody. The review is now examining whether that treatment is sufficient or whether staking requires more specific provisions.
Any expansion would have immediate consequences for exchanges and other CASPs offering staking, lending or yield products alongside trading and custody. Questions around capital, conduct and disclosure requirements are therefore likely to matter as much as the legal definitions themselves.
NFTs are another area where MiCA’s existing treatment is being tested.
The regulation excludes crypto-assets that are genuinely unique and non-fungible, including some digital art and collectibles. The exemption is narrower than attaching an “NFT” label to a token. Large series or collections can still be treated as fungible depending on their actual characteristics.
The current review asks whether developments in the NFT market justify a different approach to service providers operating around these assets.
No decision has been made to bring NFTs broadly under MiCA. The consultation does, however, reopen a category that sat largely outside the original framework.
Traditional finance is increasingly using infrastructure that overlaps with crypto markets.
Tokenised bank deposits generally remain deposits rather than becoming MiCA crypto-assets, while tokenised securities continue to fall under securities legislation when they qualify as financial instruments. Both can increasingly trade, settle or interact with systems that also support stablecoins and other crypto-assets.
Industry groups were developing their positions before the consultation opened. Coinbase has urged European policymakers to protect DeFi and self-custody, reconsider restrictions on interest-bearing stablecoins and pursue greater international regulatory alignment as MiCA evolves.
E-money tokens create another point of overlap. A crypto transfer may fall under MiCA while also constituting a payment service, raising questions over authorisation and compliance under two different frameworks.
These cases show how tokenisation is making the legal category of an asset increasingly important even when several products share similar technical infrastructure.
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CLARITY Act Fight Opens New Front With Banking IndustryFor exchanges, custodians and other European CASPs, the review could directly affect the cost and scope of doing business in the EU.
Article 140 requires policymakers to examine MiCA compliance costs for crypto-asset service providers as a share of their operating expenses. The consultation also looks at whether current capital requirements are appropriate, whether the definition of crypto services should expand and how the framework is affecting Europe’s market.
Industry groups were developing their positions before the consultation opened. Coinbase has urged European policymakers to protect DeFi and self-custody, allow interest-bearing stablecoins and pursue greater global regulatory alignment as MiCA evolves.
Those arguments now sit inside a formal review process.
Common EU rules for activities such as staking or lending could reduce the expense of navigating different national approaches. The outcome will depend heavily on how those requirements are designed: additional obligations that are difficult or costly to meet could put EU-facing firms at a disadvantage against competitors operating under lighter regimes.
That gives exchanges, issuers, banks and industry groups a strong incentive to use the consultation to show where MiCA is working and where the framework is creating unnecessary cost or uncertainty.
Industry participants have until the end of September to submit responses.
The next major step is the statutory report to the European Parliament and Council, due by June 30, 2027. Brussels will use the evidence gathered through the review to decide whether amendments are justified and, if so, what should be included in a legislative proposal.
By then, policymakers will have to make choices across several areas that were unresolved when MiCA was negotiated. Global stablecoins are testing Europe’s approach to foreign issuers, DeFi and staking are raising questions about services outside the original framework, and tokenised finance is bringing crypto infrastructure closer to traditional banking and payments.
The review will determine how much of that activity Brussels ultimately decides should fall under a revised EU crypto regime.
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