Central banks and 50,000 letter-writers pull MiCA's stablecoin yield ban in opposite directions
Stand With Crypto EU got more than 50,000 Europeans to write to the Commission's MiCA review asking that stablecoins be allowed to pay holders rewards. Europe's central banks used the same review to ask that the ban also cover lending, borrowing and staking yield, so the rule could end up wider as easily as looser.
The Investor · Invest desk
What happened
- MiCA has been in force since mid-2024, and Crowdfund Insider says its yield ban covers issuers, crypto-asset service providers and third parties.
- Stand With Crypto says the response count is more than six times the 8,221 sent to the ECB's digital euro consultation and far above the 198 the Commission received in 2020.
- The group says a separate petition backing a pro-innovation stablecoin strategy has passed 126,000 signatures.
- ECB President Christine Lagarde warned in May that deposits moving from banks into stablecoins could weaken bank lending and monetary policy transmission.
Why it matters
- Who's exposed exposure If the Commission adopts the central banks' wording, the ban that now covers direct interest would also cover crypto service providers' stablecoin lending, borrowing and staking products.
- What it costs cost Stand With Crypto argues the current ban costs euro stablecoins in the competition for balances, because bank deposits and other e-money products can offer customers benefits that the tokens cannot.
- What it sets up precedent The GENIUS Act words its ban around yield paid solely for holding a token, so the Commission has a model if it decides to allow cashback-style rewards and keep interest banned.
Next story · Science · Oct 1
Circle urges the EU to replace MiCA's bank-deposit minimum for stablecoin reservesConfirmed5 publishers
The two sides disagree about what counts as equivalent remuneration. MiCA, as Crypto Briefing describes the rule, bars issuers from paying interest or any equivalent remuneration on regulated tokens [7]. The letters ask for cashback and loyalty perks [2]. The central banks, in Crypto Briefing's account, want no form of return, direct or indirect, inside a regulated token, because the ECB holds that e-money should be a payment tool and not a savings product [16].
The letter count is roughly 250 times the Commission's 2020 turnout [18]. It shows how far a campaign can reach. The ESCB, which includes the ECB [5], filed its response on September 22 [6], eight days before the consultation closed [19]. I'd expect that one submission to carry more weight in drafting than the 50,000 letters, because it comes with a stability argument and a reserve proposal to match. The ESCB wants MiCA's rule that issuers hold a minimum share of reserves in bank deposits replaced with liquidity thresholds. Its argument is that the current rule could strain lenders if a run forced an issuer to pull deposits quickly [13]. In June the ECB also noted that stablecoins settle around the clock while their reserve assets may still settle on traditional timelines [14]. Both ESCB proposals protect banks. One removes a reason for savers to move deposits into stablecoins, and the other cuts how much issuer cash sits at banks waiting to be withdrawn in a run [6][13].
The Commission has three options. It can leave the ban as written, carve out cashback-style rewards as the campaign asks [2], or adopt the ESCB's extension, which would bring lending, borrowing and staking arrangements that generate yield inside the prohibition [6]. I think a wider ban is more likely than a looser one, because the only institutional submission in these reports asks for the wider version. The counter-case rests on competition with the dollar. Harry Pearce-Gould, Stand With Crypto EU's general manager, argues that rewards would help euro-denominated stablecoins win users and compete with dollar stablecoins [3]. "The US has made a clear choice to back stablecoins as the settlement layer for tokenisation. Europe doesn't need to copy that, but it does need to compete with it," he said [4].
If the Commission's draft lets regulated issuers offer cashback or loyalty rewards, the letters will have changed the text and I will have been wrong about which way the rule moves. "These are people who use stablecoins, understand what the rewards ban means for them, and want to be heard before the Commission decides what comes next for MiCA," Pearce-Gould said [12].
What to watch
- Whether the Commission's MiCA proposal adopts the ESCB's wording that brings lending, borrowing and staking yield inside the stablecoin interest ban.
- Whether the reserve rule moves from a minimum bank-deposit share to liquidity thresholds, and how much issuer cash leaves EU banks if it does.
Information, not investment advice. This story is general information about companies and markets, drawn from cited reporting. It is not a recommendation to buy, sell or hold any security; check the cited sources before acting.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence60
- Adoption
- Not scored
- Hype gap+15
- Incentives70
- Confidence60
Perspective Coverage
3 publishers- Builder
- Builder 23%
- Operator
- Operator 39%
- Investor
- Investor 38%
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
MiCA prohibits issuers and crypto service providers from paying interest on stablecoins, a restriction Stand With Crypto argues puts the products at a disadvantage to bank deposits and other e-money products that can offer benefits to customers.
- [2]
More than 50,000 Europeans sent comments to the European Commission's MiCA review consultation, in a push organized by Stand With Crypto EU, asking that regulated stablecoins be allowed to offer rewards like cashback and loyalty perks.
- [3]
Harry Pearce-Gould added that allowing rewards could help euro-denominated stablecoins gain adoption and compete with dollar stablecoins.
- [4]
The US has made a clear choice to back stablecoins as the settlement layer for tokenisation. Europe doesn't need to copy that, but it does need to compete with it.
- [5]
The European System of Central Banks includes the European Central Bank.
- [6]
In a Sept. 22 response to the European Commission's MiCA review, the European System of Central Banks called for the existing prohibition on stablecoin interest to extend to lending, borrowing and staking arrangements that generate yield.
- [7]
Under current MiCA rules, stablecoin issuers cannot pay interest or any equivalent remuneration on regulated tokens.
- [8]
The MiCA review consultation closed on September 30, 2026.
- [9]
Stand With Crypto said the campaign generated more than six times the 8,221 responses submitted to the ECB's digital euro consultation and far exceeded the 198 responses received during the Commission's 2020 consultation on crypto rules.
- [10]
MiCA, in force since mid-2024, bans stablecoin yield: issuers, crypto-asset service providers and third parties cannot provide rewards to stablecoin holders.
- [11]
Stand With Crypto EU says a separate petition backing a broader pro-innovation stablecoin strategy has collected more than 126,000 signatures.
- [12]
These are people who use stablecoins, understand what the rewards ban means for them, and want to be heard before the Commission decides what comes next for MiCA.
- [13]
The ESCB proposed replacing MiCA requirements that stablecoin issuers hold a minimum share of their reserves in bank deposits with liquidity thresholds, arguing the existing rules could strain lenders if a stablecoin run forced an issuer to rapidly withdraw deposits.
- [14]
The ECB noted in June that stablecoins settle around the clock while their reserve assets may still operate on traditional settlement timelines.
- [15]
In May, ECB President Christine Lagarde warned that a shift of deposits from banks into stablecoins could weaken bank lending and monetary policy transmission.
- [16]
In the ECB's view, e-money should function as a payment tool, not a savings product; the central banks want to make sure no form of return, direct or indirect, enters regulated tokens.
- [17]
The GENIUS Act, the US stablecoin law, bars permitted payment stablecoin issuers and foreign payment stablecoin issuers from paying holders any interest or yield solely for holding the token.
- [18]
The more than 50,000 letters are roughly 250 times the 198 responses to the Commission's 2020 crypto consultation.
- [19]
The ESCB filed its response eight days before the consultation closed.
Sources
3 independent publishers whose own reporting we read for this story.
- cointelegraph.com50,000 Europeans call on EU to ease stablecoin rewards restrictions in MiCA review
1 article · October 1, 2026
- crowdfundinsider.comStand With Crypto: 50,000 Letters Sent to European Commission Demanding Stablecoin Rewards
1 article · October 1, 2026
- cryptobriefing.comStand With Crypto urges EU to ease stablecoin rewards restrictions
1 article · October 1, 2026
Topics and entities
Topics
- Stablecoin Regulation
- Stablecoin Yield
- EU crypto policy
Entities
- European System of Central Banks
- Christine Lagarde
- Markets in Crypto-Assets Regulation
- Stand With Crypto EU
- Harry Pearce-Gould
- European Commission
- European Central Bank
- GENIUS Act