Briefing
The European Banking Authority (EBA) has issued critical guidance confirming that the custody and transfer of e-money tokens (EMTs) → a category including many stablecoins → constitute payment services under the Payment Services Directive (PSD2), thereby mandating a dual licensing requirement for Crypto Asset Service Providers (CASPs) already authorized under the Markets in Crypto-Assets (MiCA) regulation. This regulatory overlap severely compromises MiCA’s foundational principle of a single, harmonized passport for digital asset services across the EU, introducing significant operational and capital duplication for firms. This dual mandate takes full effect immediately following the end of the transition period on March 2, 2026.
Context
Prior to this EBA clarification, the industry operated under the assumption that MiCA, designed as the comprehensive framework for crypto-assets, would supersede or fully integrate the requirements for EMTs, providing a single, streamlined path to market access via the EU passporting system. This lack of definitive regulatory alignment between the new MiCA framework and the established PSD2 created a critical legal ambiguity, preventing stablecoin issuers from accurately scoping their compliance architecture and capital reserves for pan-European operations.
Analysis
The dual licensing requirement fundamentally alters the compliance architecture for CASPs handling stablecoins, compelling them to integrate two distinct regulatory control systems → MiCA’s market integrity and consumer protection standards alongside PSD2’s strict operational, security, and capital requirements. This forces an immediate review of corporate structuring and capital allocation, as firms must satisfy the minimum capital requirements for both a MiCA license and a payment institution license, effectively doubling the financial barrier to entry. The resulting compliance friction is projected to stifle the competitive viability of euro-denominated stablecoins within the EU market, potentially pushing innovation to more permissive jurisdictions.
Parameters
- Regulatory Deadline → March 2, 2026 → The date the EBA’s non-enforcement transition period ends, making dual licensing mandatory.
- Impacted Instruments → E-Money Tokens (EMTs) → Stablecoins that are legally classified as electronic money under EU law.
- Overlapping Directives → MiCA and PSD2 → The two EU regulations now simultaneously governing the custody and transfer of EMTs.
Outlook
The immediate strategic focus shifts to lobbying efforts aimed at securing a legislative fix, likely through amendments to the forthcoming PSD3 or a specific carve-out within MiCA, to restore the principle of proportionality and a single license. Absent a legislative intervention, this precedent will likely be adopted by national competent authorities, creating a de facto fragmented regulatory landscape and potentially leading to CASPs reducing or exiting stablecoin services in the EU before the 2026 deadline. This action sets a cautionary precedent regarding the challenge of integrating new asset-specific frameworks with legacy financial services legislation.
Verdict
The EBA’s interpretation creates a systemic regulatory friction point that undermines the foundational promise of MiCA’s single market passport for stablecoin services.
