Europe is now ready to introduce regulations for crypto markets

The European Banking Authority (EBA) has completed the draft technical standards under the Markets in Crypto Assets (MiCA) Regulation.

This progress is a positive step in the process of governing the evolving crypto industry and comes after the implementation of MiCA last year.

The final one project of technical standards outlines the measures that are considered reasonable for the creators of cryptocurrencies , stablecoins and industry service providers. Some of these standards include, a change in equity capital requirements, changes in liquidity regulations, and very strict recovery plans for crypto asset issuers.

According to the information, issuers should conduct stress tests under specific conditions of financial stress, which would help them manage their operations during periods of volatility.

In addition, the authority outlined the process by which competent authorities can impose increased financial requirements on issuers depending on the risk outlook and the results of mandatory stress tests.

The standards also provide for processes whereby issuers must make the necessary equity adjustments to meet the increased standards within a specified time frame (25 business days).

It also clarifies specific rules for the minimum level of liquidity of cryptoassets, specifying the required reserve asset ratios by daily and weekly maturity.