Global Stablecoin Regulation: MiCA, US Bills, and International Standards

The global stablecoin market has grown from a niche trading tool into a critical payment and settlement infrastructure layer. Tether (USDT) and USD Coin (USDC) together exceed $175 billion in circulation as of early 2026. JPMorgan’s Kinexys (formerly Onyx) platform processes over $2 billion in daily tokenized payment volume. The use of stablecoins for cross-border payments, treasury management, and trade settlement has moved from pilot to operational at major financial institutions. Regulatory frameworks have had to evolve commensurately — and in most jurisdictions, they have, though at different speeds and with different architectures.

MiCA: The EU Stablecoin Benchmark

MiCA’s stablecoin framework, covered in detail in the MiCA stablecoin provisions analysis, sets the most comprehensive regulatory standard currently in force globally. Key features:

• EMT issuers must be authorized credit institutions or e-money institutions — no new licensing category for stablecoin issuers
• ART issuers obtain MiCA-specific authorization from home NCA
• Mandatory 1:1 reserve backing for EMTs; low-risk liquid asset reserves for ARTs
• Redemption at par (EMTs) or reserve-equivalent value (ARTs) required
• Non-EUR stablecoins face a €200 million daily EU transaction cap
• Significant issuers face direct EBA supervision and enhanced capital requirements

The EU framework’s extraterritorial reach — applying to any stablecoin offered to EU persons regardless of issuer domicile — has compelled Tether, Circle, and other major issuers to engage with EU compliance. Circle obtained EMI authorization in France in Q4 2024; Tether has not sought EU authorization and has faced questions about continued EU market access.

United States: Legislative Standoff

The US entered 2026 without a finalized federal stablecoin regulatory framework — a gap that has materially constrained institutional stablecoin adoption in the world’s largest financial market. The competing proposals reflect fundamental disagreements about regulatory architecture.

The GENIUS Act (Lummis-Gillibrand): Passed the Senate Banking Committee in March 2025 with bipartisan support. Key provisions:

• Creates a federal licensing pathway for “payment stablecoin” issuers (tokens redeemable 1:1 for USD)
• Permits non-bank issuers to obtain a federal payment stablecoin issuer charter from the OCC
• Requires 1:1 backing with cash or short-duration US Treasuries
• Provides state primacy for issuers with total outstanding stablecoins below $10 billion
• Prohibits algorithmic stablecoins that lack full reserve backing
• Mandates par-value redemption within a specified timeframe
• Subjects issuers to AML/BSA obligations under FinCEN

The STABLE Act (House version): Takes a more restrictive approach:

• Limits stablecoin issuance to insured depository institutions and federally approved non-bank entities
• Requires direct Federal Reserve oversight of any non-bank issuer above $10 billion
• Imposes a two-year moratorium on algorithmic stablecoins pending study
• Requires approval from primary federal banking regulator before a new stablecoin is issued

The fundamental disagreement is over whether large non-bank stablecoin issuers should be subject to Federal Reserve oversight — effectively making them quasi-bank entities — or whether a lighter federal charter suffices.

State frameworks: In the absence of federal legislation, New York’s Department of Financial Services has applied its BitLicense and virtual currency guidance to stablecoin issuers operating in New York, establishing de facto reserve and redemption requirements for a significant portion of the US market.

Singapore: MAS Finalized Framework

MAS’s stablecoin regulatory framework, finalized in August 2023 and operational from its effective date, applies to single-currency pegged stablecoins (SCS) issued in Singapore and denominated in SGD or any G10 currency where the issuer has Singapore dollar or G10 currency backing.

Key requirements:

Reserve backing: SCS must be backed by reserve assets consisting of cash, cash equivalents, or debt securities with residual maturity no longer than 3 months, denominated in the peg currency. Reserve assets must equal or exceed the par value of outstanding SCS at all times.

Capital requirements: Issuers must maintain a minimum base capital of SGD 1 million and net head office funds (for Singapore branches of foreign entities) of at least the same amount.

Redemption at par: Issuers must redeem SCS at par value within 5 business days of a redemption request.

Audit: Annual audited financial statements. Auditors must verify reserve compliance.

MAS recognition: Issuers that satisfy all requirements may apply for MAS recognition as a “MAS-regulated stablecoin” — enabling use of that label in marketing. Issuers that do not meet the standard are prohibited from using the stablecoin label in Singapore.

Licensing: SCS issuers must hold a Major Payment Institution license under the Payment Services Act. MAS’s digital payment token framework is detailed at mas.gov.sg.

United Kingdom: Incoming Stablecoin Regime

The UK’s stablecoin regulatory framework has proceeded through HM Treasury and the FCA in parallel phases. The Financial Services and Markets Act 2023 brought systemic stablecoins within the Bank of England’s regulatory perimeter. The FCA is responsible for authorizing fiat-backed stablecoin issuers used in payment activities.

Key features of the UK regime (effective from 2025):

• Systemic stablecoins designated by HMT are subject to Bank of England supervision
• Fiat-backed stablecoins used for payment must obtain FCA authorization
• Reserve requirements and redemption rights mirror the direction of MiCA and MAS frameworks
• The FCA has signaled that backing with non-cash assets (e.g., government bonds) will be permitted within limits

UK-established stablecoin issuers post-Brexit do not benefit from EU passporting and must satisfy both UK and MiCA requirements separately if they wish to operate in both markets.

FSB: The International Baseline

The Financial Stability Board’s high-level recommendations for global stablecoin arrangements were finalized in 2020 and revised in 2023 to reflect the growth in stablecoin markets and the TerraUSD collapse. The FSB’s recommendations are non-binding but have been adopted by the G20 as the international standard.

The FSB framework, detailed at fsb.org, applies the “same activity, same risk, same regulation” principle. Key recommendations:

• Stablecoin arrangements should be subject to comprehensive regulation and oversight proportionate to the financial stability risks they pose
• Authorities should have appropriate powers to regulate, supervise, and if necessary prohibit, stablecoin arrangements
• Stablecoin issuers should have robust risk management frameworks including redemption arrangements, reserves, and operational resilience
• Global stablecoin arrangements that operate across multiple jurisdictions should be subject to cooperation between relevant authorities

Exhibit: Stablecoin Regulatory Comparison

For the specific MiCA stablecoin analysis, see MiCA stablecoin provisions. For the AML/KYC obligations applying to stablecoin transactions, see AML/KYC for tokenization platforms.

External references: ESMA MiCA | MAS Digital Payment Tokens | FSB Crypto-Assets