---
title: "The Risks of Regulatory Fragmentation in the Stablecoin Market: The Case of Multi-Issuance Stablecoins"
authors:
  - name: "Anastasia Sotiropoulou"
    affiliation: "University of Orléans, France (Professor of Law)"
  - name: "Alexis Direr"
    affiliation: "University of Orléans, France (Professor of Economics)"
date: "2026-06-24"
type: working-paper
status: working paper
keywords: [stablecoins, multi-issuer stablecoins, multi-issuance, MiCAR, GENIUS Act, regulatory fragmentation, regulatory arbitrage, e-money tokens, redemption rights, reserve adequacy, cross-border supervision, financial stability, contagion, European Banking Authority, equivalence regime]
language: en
field: [law, economics]
---

# The Risks of Regulatory Fragmentation in the Stablecoin Market: The Case of Multi-Issuance Stablecoins

**Authors**
- Anastasia Sotiropoulou — University of Orléans, France — Professor of Law
- Alexis Direr — University of Orléans, France — Professor of Economics

**Status**: Working paper (version dated 24 June 2026). No DOI or journal assigned. The authors describe the article as adopting a combined law-and-economics perspective.

**Keywords**: stablecoins, multi-issuer arrangements, MiCAR, GENIUS Act, regulatory fragmentation, regulatory arbitrage, e-money tokens, redemption rights, reserve adequacy, cross-border supervision, financial stability.

---

## Abstract

Stablecoins are designed to maintain a stable value through redeemability at par and the holding of external reserves, yet their cross-border issuance increasingly exposes regulatory and financial stability vulnerabilities. This article examines the risks arising from multi-issuer stablecoin arrangements, whereby a single, fungible stablecoin is issued by multiple legally distinct entities across different jurisdictions and regulatory regimes. Focusing on the European Union's Markets in Crypto-Assets Regulation (MiCAR), the analysis shows how such structures—currently employed by major issuers such as Circle and Paxos—facilitate regulatory arbitrage, amplify liquidity and redemption risks, and undermine the effectiveness of EU prudential supervision.

The article highlights how the fungibility of tokens issued under divergent regimes may concentrate redemption pressures on EU issuers, strain reserve adequacy, and create contagion risks for the EU banking sector. Legal and operational frictions, including the potential ring-fencing of reserves held outside the Union, further exacerbate these vulnerabilities, particularly under stressed market conditions. While MiCAR equips competent authorities with certain supervisory tools, data limitations and uncertainties surrounding the classification of 'significant' issuers constrain their effective use.

The article argues that MiCAR inadequately addresses the systemic implications of cross-border multi-issuer stablecoins and proposes targeted reforms. These include a centralised supervisory regime for participating EU issuers under the European Banking Authority, complemented by a stringent equivalence framework for third-country partners which would limit multi-issuance to jurisdictions with comparable regulatory standards. The article concludes that enhanced cross-border supervisory cooperation and coordinated crisis management frameworks are essential to ensure the resilience of stablecoin markets and to safeguard financial stability within the Union.

---

## 1. Motivation and contributions

Stablecoins are digital tokens recorded on distributed ledgers that aim to maintain a stable value relative to a reference asset, most often a fiat currency. For fiat-backed stablecoins, stability is ensured through on-demand redemption at par and backing by external reserves held in liquid, low-risk assets. The article situates the topic with several market facts: according to a Banque de France report, the global stablecoin market was valued at approximately USD 237 billion, roughly 7% of the total crypto-asset market; dollar-denominated stablecoins account for 99% of that market, heavily concentrated in Tether's USDT (nearly 64%) and Circle's USDC (25%); by contrast, euro-denominated stablecoins have a combined capitalisation of only around USD 350 million (about 0.15% of the total), led by EURC (Circle) and EURS (Stasis). Stablecoins have so far functioned mainly as settlement assets within the crypto ecosystem, as stores of value, and as DeFi collateral, with a potential role in cheaper cross-border payments — though the article notes that apparent remittance-cost savings (Chainalysis estimates roughly 60% versus traditional methods for Sub-Saharan Africa, against a World Bank global average remittance cost of about 6.365% for a USD 200 transfer) may be overstated once conversion into and out of fiat is included.

The article's central concern is **regulatory fragmentation**. Unlike banking supervision, harmonised internationally since the Basel Accords, stablecoin regulation has developed largely on a regional basis: the EU adopted the Markets in Crypto-Assets Regulation (MiCAR) in 2023, with progressive implementation from 2024; the United States enacted the GENIUS Act on 18 July 2025, set to take effect by 2027. Because stablecoins move instantaneously across borders, the absence of common international standards creates scope for regulatory arbitrage, incentivising issuers to locate operations in the least stringent jurisdiction while serving clients in more tightly regulated markets.

Adopting a combined law-and-economics perspective, the article examines the risks of regulatory fragmentation arising from **multi-issuer stablecoins** — arrangements in which a single, fungible token is issued by legally distinct entities operating across different jurisdictions and regulatory regimes (in particular the EU and the US). Deeming the token fungible across jurisdictions lets issuers fragment their reserve management while allowing holders to choose where to exercise redemption rights — preferably the EU, which offers more favourable terms. Because MiCAR did not foresee or explicitly regulate multi-issuer arrangements, there is no guarantee that reserves held in a third country will be available to meet increased redemption demand in the EU; this structural mismatch threatens to transmit liquidity runs and contagion to EU issuers and their banking partners.

The analysis proceeds in three steps, which constitute the paper's central argument:

1. **MiCAR and the GENIUS Act diverge in several respects** (Section II). The two regimes differ in scope, licensing, reserve composition, prudential requirements, holder protections, crisis management, supervision, and extraterritorial reach.
2. **Under multi-issuer programmes these legal differences are not neutral** (Section III). Because the same token issued under divergent regimes is economically fungible, the differences generate arbitrage incentives and redistribute redemption pressures across issuers — risks that are *financial in nature but legal in origin*.
3. **This economically driven pressure exposes a legal gap in MiCAR, calling for a policy response** (Section IV). The article argues MiCAR inadequately addresses cross-border multi-issuance and proposes targeted reforms.

---

## 2. Framework and setting: regulatory fragmentation between MiCAR and the GENIUS Act

Both MiCAR and the GENIUS Act establish regulatory regimes for stablecoins, and both pursue broadly common objectives — legal certainty, consumer protection, market integrity. But they diverge substantially in scope and design. For comparability the article uses "stablecoins" to refer to single-currency-pegged tokens — MiCAR's *e-money tokens* (EMTs) and the GENIUS Act's *payment stablecoins*.

MiCAR introduces three crypto-asset categories under a risk-based, tiered approach: **EMTs** (referencing one official currency), subject to the most stringent requirements; **asset-referenced tokens (ARTs)**, referencing another value or a basket, at an intermediate level; and a residual category of "other" crypto-assets (including unbacked assets such as Bitcoin and utility tokens), subject to lighter, disclosure-centred rules.

### Table 1 — MiCAR (EU) versus the GENIUS Act (US): main divergences

| Dimension | MiCAR (European Union) | GENIUS Act (United States) |
|:---|:---|:---|
| Scope | Broad: regulates EMTs, ARTs, and a residual "other" category; also a full regime for crypto-asset service providers (CASPs) | Narrow: applies to "payment stablecoins" only; excludes central-bank money, bank deposits, and securities |
| Service providers | Comprehensive CASP regime — prior authorisation, governance, prudential safeguards, client-asset segregation, conduct rules | Does not regulate service providers as such; from 18 July 2028, "Digital Asset Service Providers" (exchanges, custodians, brokers) may not offer a payment stablecoin unless issued by a permitted issuer — but no comprehensive prudential or investor-protection mandate |
| Issuer licensing | Issuance restricted to licensed credit institutions and electronic-money institutions; generally a notification rather than a bespoke authorisation | Banks and non-banks may issue; explicit authorisation for subsidiaries of insured depository institutions and a dedicated stablecoin-specific licence for non-banks |
| "Significant" issuers | Differentiated regime: issuers classified as significant (by size, volume, systemic relevance) face enhanced prudential and reserve requirements and are supervised directly by the EBA | Tiered by size — state-qualified issuers below USD 10 billion may opt for state regulation if "substantially similar" to the federal regime, transitioning to federal oversight within 360 days above the threshold — but small and large issuers face comparable obligations |
| Reserve assets | At least 30% of reserves in liquid bank deposits; the remainder only in "highly liquid financial instruments" — strict liquidity constraints | Broader range: Treasury securities, money market fund shares, repos and reverse repos backed by liquid assets — more flexibility and yield, but higher systemic risk; no explicit mitigation of concentration risk |
| Prudential requirements | Quantitatively and qualitatively defined preventive requirements, especially for significant issuers; preventive in nature | Capital and liquidity requirements imposed via secondary regulation only as needed for orderly operations; ensures operational capacity, more market-oriented |
| Remuneration | Prohibits both issuers and CASPs from granting interest on services related to EMTs | Bars issuers from directly paying interest; silent on whether affiliates or third parties may offer reward/yield programmes |
| Redemption rights | Article 49(2) creates a legal claim for the holder against the issuer, even absent a direct issuer–holder relationship; redemption at par regardless of domicile | The redemption obligation is not clearly defined; vague phrasing leaves it unclear whether any holder or only verified/institutional clients may redeem |
| Redemption fees | Prohibited (Article 49(6)); a narrow exception under Article 46 allows liquidity-related fees within a recovery plan to restore reserve compliance | Permitted, subject to disclosure (clear plain-language disclosure of all fees, changeable on at least 7 days' notice) |
| Market abuse | Extends the EU market-abuse framework to crypto-assets admitted to trading | No equivalent market-abuse regime |
| Crisis management | Requires recovery and resolution plans — an integrated financial-stability approach | Limited crisis tools; relies on supervisory intervention and reserve requirements; focuses on bankruptcy, granting holders priority over other creditors |
| Supervision | Two-tier: national competent authorities for most issuers, EBA for significant issuers — broad powers, but the structure may delay intervention | Highly fragmented: primary federal regulator depends on entity type (Fed, OCC, FDIC, NCUA) or the relevant state regulator; OCC is primary regulator for federal non-bank issuers |
| Cross-border reach | Both prohibit unlicensed issuers domestically; MiCAR permits only supervisory-cooperation agreements, with no equivalence regime granting foreign stablecoins access to the internal market | Allows foreign issuers to market stablecoins if the Treasury Secretary deems the home regime comparable, the issuer registers with the OCC, and reserves are held in US financial institutions; the Treasury may negotiate interoperability agreements |

Beyond the EU and US, other jurisdictions — the United Kingdom, the United Arab Emirates, Japan, Singapore, Hong Kong — have developed bespoke regulatory models, further intensifying fragmentation. The UK approach, for instance, would subject only domestically issued stablecoins to oversight while allowing foreign-issued stablecoins to be traded on UK platforms.

The article closes the section with the hinge of its argument: these divergences would be of limited consequence if the tokens they govern were distinct instruments. Section III shows why the economic fungibility of multi-issuer tokens turns each legal divergence into an exploitable margin.

---

## 3. Mechanisms and channels: the case of multi-issuer stablecoins

A **multi-issuer stablecoin** is an arrangement in which the same single, fungible digital token is issued by multiple entities established in different jurisdictions. Because the tokens are technically identical, they remain fully interchangeable on secondary markets regardless of the issuing entity or the regime under which they were issued. The model is currently used by Circle (USDC) and Paxos (USDG): Circle issues USDC through Circle Internet Financial LLC in the US (under the GENIUS Act), Circle SAS in France (a licensed electronic-money institution under MiCAR), and a subsidiary in Singapore; Paxos issues USDG concurrently under MAS oversight in Singapore and MiCA rules via Finland's FIN-FSA, alongside a US national trust charter from the OCC. The EU entity is typically owned or controlled by the non-EU entity, and the reserves are distributed across jurisdictions.

The core thesis: the resulting risks are **financial in nature but legal in origin** — because the token is fungible across issuers, any regulatory divergence becomes an exploitable arbitrage margin, and redemption pressure flows to whichever issuer offers the most favourable terms. A token issued by Circle LLC in the US and one issued by Circle SAS in France are economically fungible, yet legally subject to distinct regimes (segregated MiCAR-compliant reserves versus the comparatively less stringent GENIUS framework); this differentiation is invisible at the level of the distributed ledger — "for the blockchain, a USDC remains a USDC."

The article identifies the following interconnected mechanisms.

### 3.1 Amplified liquidity and redemption risk

Each co-issuer could potentially be held liable for the *entire* circulating supply of the token, even though it holds only a fraction of the corresponding reserves. This creates a mismatch between redemption obligations and available reserves whenever redemptions concentrate in one jurisdiction while reserves sit elsewhere. The triggering channel: a run on a third-country issuer prompts holders to redeem instead from the EU issuer, concentrating redemptions in the EU, straining the EU issuer's reserves, delaying redemptions, and amplifying the run within the Union. If EU-based reserves are insufficient, the arrangement relies on a private-law **rebalancing mechanism** — an inter-issuer agreement under which the third-country issuer transfers assets.

### 3.2 The fungibility loophole and the failure of residency-based restrictions

To mitigate this exposure, participants restrict redemption rights by holder residence: the Circle SAS white paper grants a direct redemption right only to EEA-resident holders, directing non-EEA holders to Circle LLC. The article argues this restriction is legally ineffective under MiCAR: Article 49 obliges EMT issuers to grant a redemption right *regardless of holder domicile*, so the right depends on the token's origin (whether it was issued by a MiCAR-regulated entity), not on where the holder lives — making the Circle SAS limitation inconsistent with both the wording and the spirit of MiCAR. More fundamentally, once a token is in secondary circulation it is virtually impossible to distinguish whether a specific USDC was originally issued by Circle SAS or Circle LLC, because USDC is fully fungible on-chain. This technical ambiguity is a significant loophole: any global holder of secondary-market USDC could seek to exercise redemption rights under the EU framework. The article adds that even a valid residency restriction would not solve the problem, since EU residents could still buy discounted USDC on the secondary market and redeem at face value, rendering residency-based segregation nugatory.

### 3.3 Contagion to the EU banking sector

The failure of an EMT issuer could threaten financial stability through contagion. **Direct contagion** arises if the issuer is itself a credit institution; **indirect contagion** arises because an electronic-money institution holds deposits at EU credit institutions, as MiCAR requires. Herding effects, amplified by the rapid spread of information (accurate or not), can intensify runs — the article invokes the Silicon Valley Bank episode. Although individual EMT issuances are capped at 1.5% of a bank's assets, there is no aggregate limit on the deposits a bank may receive from multiple EMT or ART issuers, which could give rise to "crypto-friendly banks" disproportionately reliant on crypto-asset funding. Bank reserve requirements for these deposits are high — 30% for non-significant issuers and 60% for significant issuers.

### 3.4 Legal and operational frictions: ring-fencing of foreign reserves

When an EU issuer holds reserves in a foreign currency (e.g., US dollars), those assets are typically located outside the EU, in the currency's home jurisdiction. Even where inter-issuer reserve-balancing agreements exist, in a crisis they may not work: reserves held abroad could be ring-fenced by foreign authorities, exposed to capital controls, regulatory restrictions, or settlement delays, as foreign authorities prioritise their own domestic markets. Reserves may therefore be unavailable to meet redemptions in the Union.

### 3.5 Regulatory asymmetry and arbitrage of redemption conditions

Third-country issuers are not necessarily subject to MiCAR-equivalent safeguards. Where they are not, holders can arbitrage redemption conditions — redeeming in the EU when its terms are more favourable. Because EU issuers must redeem EMTs at par and at no cost, holders are incentivised to redeem with the EU issuer if the third-country issuer charges fees or has a longer reimbursement timeline. A market participant could acquire a multi-issuance stablecoin below par on some exchange and seek fee-free redemption at face value from the EU issuer, securing a risk-free gain — an opportunity that could be amplified by market manipulation, and that in a de-pegging event would channel redemption requests toward the EU entity, exacerbating system stress.

> **Authors' critical reading.** The article stresses that the prohibition on redemption fees for EU issuers, intended as a holder protection, becomes under multi-issuance a channel that concentrates stress: the very feature that makes the EU regime more protective is what makes the EU issuer the redemption destination of choice during distress.

### 3.6 Undermining of EU supervision and strategic autonomy

Multi-issuance diverges from traditional risk-management and supervisory standards: EU entities and their prudential supervisors could be held accountable for the liabilities of both EU and third-country issuers, weakening the effectiveness of EU supervision and setting a precedent that grants non-EU issuers access to the single market without complying with EU safeguards. It could also facilitate circumvention of MiCAR limits on the large-scale issuance of foreign-currency stablecoins, undermining monetary sovereignty. Finally, beyond prudential and supervisory concerns, the proliferation of US-dollar stablecoins raises **strategic-autonomy** issues: it could entrench non-EU issuer dominance, channel European savings into US assets such as Treasuries, and undermine the development of euro-denominated stablecoins — in tension with the EU's Savings and Investment Union and leaving the European market reliant on foreign infrastructures and liquidity.

---

## 4. Policy assessment and recommendations

### 4.1 The legal gap: does MiCAR address cross-border multi-issuance?

MiCAR addresses multiple issuance of ARTs and EMTs *among Union-based issuers* (requiring, for example, a single shared reserve and custody policy where different EU issuers issue the same token), but it does not expressly address joint issuance of the same single-currency token by EU and third-country entities.

The article rebuts two arguments that MiCAR already covers the case:

- **Article 56(2)** provides that where several issuers issue the same EMT, the significance criteria are assessed after aggregating their data. But, the authors argue, this applies only to EU issuers — third-country entities cannot "issue e-money tokens" within the meaning of MiCAR, since under Article 48(1) only EU-established credit institutions and electronic-money institutions are authorised to do so. Article 56(2) therefore cannot be relied upon to bring third-country multi-issuance within MiCAR.
- **Recital 54** (cited as evidence that cross-border issuance was contemplated) does not support that reading either: recitals are not legally binding and serve only as interpretative aids; Recital 54 refers exclusively to ARTs, not EMTs; applying it by analogy to EMTs would disregard the different reserve rules governing the two token types; and even by analogy it concerns only the multi-jurisdictional *marketing of EU-issued* tokens, not the marketing of *foreign-issued* tokens within the EU.

The article then asks whether MiCAR *prohibits* multi-jurisdictional issuance of EMTs, distinguishing two cases:

- **EMTs referencing an official currency of an EU Member State (e.g., the euro).** Article 48(2), read with Article 48(1), implies a prohibition for third-country entities: an EMT referencing a Member State currency is deemed offered to the public in the Union, so it falls under EU law and must be issued by an authorised credit institution or electronic-money institution. A third-country entity cannot lawfully issue a euro-denominated stablecoin, and multi-issuance of such EMTs involving a third-country entity is therefore prohibited.
- **Foreign-currency EMTs (e.g., USD-denominated).** Highly debatable. The authors' view: because EMTs can only be issued by EU credit institutions and electronic-money institutions, a foreign-issued stablecoin cannot be actively offered in the EU or listed on EU exchanges — but this does *not* prevent an EU-authorised entity from issuing a stablecoin that is also concurrently issued by a foreign entity. So Circle SAS may issue and market USDC in the EU, while USDC issued directly by Circle LLC may not be actively marketed or listed there. Yet, owing to on-chain fungibility, if a user deposits LLC-issued USDC onto a regulated European exchange, the exchange or Circle's European clearing systems will manage the token under the MiCA-authorised framework, seamlessly linking it to the European redemption and liquidity pool.

MiCAR's silence, the article concludes, reflects a **significant legislative oversight**: legislators failed to foresee that a single global token ledger could create a direct conduit between EU-authorised entities and non-EU affiliates. The result is an "interpretive crisis" for EU regulators, as the fungibility of co-issued tokens outpaces the territorial, subsidiary-based enforcement mechanisms built into the Regulation.

### 4.2 Existing supervisory tools and their limits

Even without an explicit multi-issuance regime, competent authorities have some tools. Under **Article 35** they may increase own-funds requirements, including capital add-ons of 20% or more where risk-management deficiencies, adverse stress-test outcomes, or elevated redemption risks are identified — and participation in multi-issuer schemes may justify stricter capital requirements. Under **Article 45(4)** liquidity requirements for significant issuers may be raised on the basis of stress tests. Under **Article 58(2)** authorities may require electronic-money institutions issuing *non-significant* EMTs to comply with significant-issuer requirements where necessary to address liquidity, operational, or reserve-management risks; for credit institutions, the ECB or national authorities can use the **Pillar 2** framework under the Capital Requirements Directive to impose additional capital requirements.

These tools, however, are constrained. Many powers apply in principle only to issuers of *significant* EMTs, and the significance classification is itself difficult, given uncertainties in measuring the volume of tokens circulating in the Union and insufficient reporting by service providers. Circle SAS, which participates in a multi-issuer arrangement, has not been classified as significant and remains supervised by the French competent authority (the ACPR). Persistent data gaps — particularly on token holdings and their geographic distribution — limit the effectiveness of stress tests. And even for significant issuers, it is uncertain whether enhanced liquidity and capital requirements can adequately mitigate the risk of non-EU holders redeeming at the expense of EU holders, or address the risk that third-country supervisors restrict the transfer of reserves to the EU issuer.

### 4.3 Recommendations

The article weighs and then sets aside an outright **ban** on cross-border multi-issuer schemes — the option underlying the ESRB's recommendation that the Commission not treat such schemes as permitted under the current MiCAR framework. A ban is judged too radical and costly: it would fragment the internal market by effectively freezing authorisations already granted to EU participants, would do little to curb European exposure to dollar stablecoins (which would shift offshore), and would run counter to MiCAR's purpose of bringing global stablecoins within the EU's regulatory perimeter rather than driving them out.

The article instead proposes a balanced package:

1. **A special EU regime for multi-issuance participants.** Amend MiCAR to create a dedicated regime for EU issuers participating in multi-issuance schemes, with supervisory responsibility assigned to the **European Banking Authority**, empowered to impose tailored prudential requirements, conduct enhanced stress testing, and implement recovery measures including redemption fees or limits — preventing fragmentation and arbitrage within the EU and promoting consistent oversight.
2. **A stringent equivalence regime.** Amend MiCAR to permit multi-issuance arrangements only with jurisdictions maintaining regulatory standards comparable to the Union's, anchored in an EU-level equivalence assessment and coupled with reciprocity arrangements so that euro-denominated stablecoins receive comparable treatment in the partner jurisdiction.
3. **Coordinated cross-border crisis management.** Amend MiCAR to include coordinated cross-border crisis-management protocols, with mechanisms for consistent monitoring and verification of reserve adequacy (size, quality, and geographic location of reserves) and arrangements for the swift transfer of assets free of legal or operational impediments.

Regulatory intervention is presented as both timely and justified: common rules would contribute to a more coherent and resilient global framework for stablecoin supervision and enhance confidence in cross-border arrangements.

---

## 5. Conclusion

The article's overall argument is that the risks of cross-border multi-issuer stablecoins are financial in nature but legal in origin. Section II establishes that MiCAR and the GENIUS Act diverge across scope, licensing, reserve composition, prudential requirements, holder protections, crisis management, supervision, and extraterritorial reach. Section III shows that, because a multi-issuer token is economically fungible across these divergent regimes, the legal differences are not neutral: they create arbitrage incentives and redistribute redemption pressure toward the most protective issuer — typically the EU one — straining its reserves, exposing the EU banking sector to direct and indirect contagion, and exposing EU issuers to the ring-fencing of reserves held abroad. Section IV argues that MiCAR contains a genuine legislative gap: it regulates multi-issuance among EU issuers but not joint issuance with third-country entities, and neither Article 56(2) nor Recital 54 closes that gap. While competent authorities hold some tools (capital add-ons, liquidity requirements, Article 58(2) powers, Pillar 2), data limitations and the unresolved "significant" classification constrain their use. The authors therefore favour, over an outright ban, a targeted reform package: an EBA-supervised special regime for EU multi-issuance participants, a stringent equivalence regime restricting multi-issuance to comparably regulated jurisdictions, and coordinated cross-border crisis-management protocols. The broader conclusion is that enhanced cross-border supervisory cooperation and coordinated crisis management are essential to the resilience of stablecoin markets and to safeguarding financial stability within the Union.

### Assumptions, scope, and stated caveats

The following collects the scope conditions and caveats the authors themselves state — a faithful extraction, not an external critique.

- **Scope of the analysis.** The article adopts a combined law-and-economics perspective and focuses on multi-issuer arrangements involving EU and US entities, examined primarily through MiCAR. It uses "stablecoins" as shorthand for single-currency-pegged tokens (MiCAR EMTs and GENIUS payment stablecoins).
- **Efficiency of stablecoin payments.** The authors caution that the apparent cross-border cost savings of stablecoins may be overstated once the initial conversion into stablecoins and reconversion into fiat are included in an end-to-end cost assessment.
- **Interpretive uncertainty.** The article repeatedly flags that key legal questions are unsettled: whether MiCAR permits multi-issuance of foreign-currency EMTs is described as "highly debatable," and the authors present an explicitly contested reading — citing both a supporting view (Athanassiou) and a more permissive contrary view (Zetzsche) that Recital 54 establishes a broader principle extending to EMTs. National competent authorities have sought clarification from the European Commission, which had not provided a definitive answer at the time of writing.
- **Data limitations.** The authors stress that persistent data gaps — particularly on token holdings and their geographic distribution, and insufficient reporting by service providers — currently constrain stress testing and the effective exercise of MiCAR supervisory powers, and make the classification of issuers as "significant" difficult.
- **Effectiveness of existing tools.** Even where enhanced liquidity and capital requirements apply to significant issuers, the authors state it is uncertain whether they can adequately mitigate the risk of non-EU holders redeeming at the expense of EU holders, and that such requirements do not address the risk of third-country supervisors restricting reserve transfers.

### Limitations and policy directions

The article does not present a formal limitations list; the constraints above are stated in context. Its forward-looking content is the reform agenda of Section IV — a special EBA-supervised regime for multi-issuance participants, an equivalence regime with reciprocity, and coordinated cross-border crisis-management protocols — together with the implicit need for the European Commission to resolve the interpretive uncertainty surrounding the legality of third-country multi-issuance under MiCAR.

---

## Acknowledgments

The authors thank Christopher K. Odinet for his valuable comments. All errors are the authors' own.

---

## Main references

The following works and instruments are most central to the article's argument; the full set of legal sources and footnotes appears in the PDF.

Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023 on markets in crypto-assets (MiCAR).

Guiding and Establishing National Innovation for US Stablecoins Act (GENIUS Act), 2025, 12 U.S.C. §§ 5901–5916.

Aldasoro, I., Mehrling, P., Neilson, D. (2024). On Par: A Money View of Stablecoins. *Journal of Financial Market Infrastructures* 11, 47.

Aldasoro, I., Aquilina, M., Lewrick, U., Hyuk Lim, S. (2025). Stablecoin growth — policy challenges and approaches. *BIS Bulletin* No. 108.

Arnal, J. (2025). Multi-issuance stablecoins and MiCA's first real credibility test. CEPS, 11 September 2025.

Athanassiou, Ph. (2026). Multi-issuance schemes for payment stablecoins: an EU–US comparison. *Journal of International Banking and Financial Law* 2, 119.

Banque de France (2025). *Financial Stability Report*.

European Systemic Risk Board (2025). Crypto-assets and Decentralised Finance: October 2025 Report on Stablecoins, Crypto-investment Products and Multifunction Groups.

European Systemic Risk Board (2025). Recommendation of 25 September 2025 on third-country multi-issuer stablecoin schemes (ESRB/2025/9).

Financial Stability Board (2023). High-level Recommendations for the Regulation, Supervision and Oversight of Global Stablecoin Arrangements.

General Secretariat of the Council (2025). ECB non-paper on EU and third-country stablecoin multi-issuance. Working Document, FSC, 10 April 2025.

Odinet, Ch. K., Tosato, A. (2026). Regulating Centralized Stablecoins: Comparing MiCAR and the GENIUS Act. *Notre Dame Law Review Reflection* (forthcoming).

Odinet, Ch. K., Tosato, A., Yadav, Y. (forthcoming). The Moneyness of Stablecoins. *Yale Law Journal*.

Santner, M., Taudes, A. (2025). The Impact of MiCAR on the Euro Stablecoin Market.

Zetzsche, D. (2026). Third-country multi-issuer stablecoins. *ERA Forum* 27, 165.

Zetzsche, D., Woxholth, I. (2025). *The EU Law on Crypto-Assets*. Cambridge University Press.

*The full reference list appears in the PDF.*