Europe's Banking Watchdog Targets Stablecoin Liquidity To Prevent Future Crises

Grand News Network | November 8, 2023

The European Union's banking regulator, the European Banking Authority (EBA), has put forward a draft of new regulatory requirements that will affect stablecoin issuers, particularly focusing on bolstering their capital holdings and ensuring ample liquidity.

These suggested regulations are designed to protect against the risk of rapid withdrawals that could lead to wider financial instability, particularly during times of market stress.

The timing of the EBA's move coincides with the broader industry discussions expected at Benzinga's Future of Digital Assets conference on Nov. 14, where the resilience and stability of digital assets in crisis situations will be a topic of considerable interest.

The EBA's liquidity proposal mandates that stablecoins, especially those ...

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