European Council and EC adopted a joint statement on stablecoins. According to the statement, stablecoins present opportunities in terms of cheap and fast payments, especially cross-border payments. However, these arrangements pose multifaceted challenges and risks related to cyber-security and operational resilience, market integrity, governance, and legal certainty. The Council and EC stated that no global stablecoin arrangement should begin operation in EU until the legal, regulatory, and oversight challenges and risks are adequately identified and addressed, underlined by the recent report of the G7 working group dedicated to these issues.
The risks raised by stablecoin arrangements should be subject to clear and proportionate regulatory and oversight frameworks, which are established on a sound evidence base and based on general principles and applicable to all stablecoin arrangements. Consistent with the global response, the Council and EC are willing to act swiftly, in cooperation with ECB, the national Supervisory Authorities, and ESAs. This approach should include consultation and development of the evidence base as precursors to potentially developing new legislation for a common EU approach to crypto-assets, including stablecoins.
While European payment systems already made significant progress, European payment actors, including payment services providers, also have a key role to play in this respect. ECB and other central banks and national competent authorities will further explore the ongoing digital transformation of the payment system and, in particular, the consequences of initiatives such as stablecoins. Also, there is a need to ensure legal clarity about the status of stablecoin arrangements. Some recent projects of global dimension provided insufficient information on how precisely they intend to manage risks and operate their business, which makes it very difficult to reach definitive conclusions on whether and how the existing EU regulatory framework applies. Entities that intend to issue stablecoins, or carry out other activities involving stablecoins in the EU, should provide full and adequate information urgently to allow for a proper assessment against the applicable existing rules.
Related Link: Press Release
Keywords: Europe, EU, Banking, Insurance, Securities, Stablecoins, Cyber Risk, Cryptocurrencies, Fintech, Operational Risk, Cross-border Payments, EC, European Council
The Office of the Superintendent of Financial Institutions (OSFI) published the strategic plan for 2022-2025 and the departmental plan for 2022-23.
The European Banking Authority (EBA) is consulting, until August 31, 2022, on the draft implementing technical standards specifying requirements for the information that sellers of non-performing loans (NPLs) shall provide to prospective buyers.
The European Council and the Parliament reached an agreement on the revised Directive on security of network and information systems (NIS2 Directive).
The European Banking Authority (EBA) published the final draft regulatory technical standards specifying information that crowdfunding service providers shall provide to investors on the calculation of credit scores and prices of crowdfunding offers.
The European Securities and Markets Authority (ESMA) published a paper that examines the systemic risk posed by increasing use of cloud services, along with the potential policy options to mitigate this risk.
The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.
The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.
The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),
The Swiss National Bank (SNB) published Version 1.2 of the reporting forms (NSFR_G and NSFR_P) on the net stable funding ratio (NSFR) of banks, along with the associated documentation.
The Farm Credit Administration published, in the Federal Register, the final rule on implementation of the Current Expected Credit Losses (CECL) methodology for allowances