AUSTRIA Trends and Developments Contributed by: Oliver Völkel, CERHA HEMPEL
What are stablecoins? At their core, stablecoins are digital instruments pegged to legal tender or other assets. Buyers obtain a right to redeem them at par value. Unlike volatile crypto-assets such as Bitcoin, stablecoins are not designed for speculation but for stability. In particular, they hold promise for international payments, offering speed, cost-efficiency and reliability. Transactions are carried out via blockchain, in principle, borderless and near instantly. MiCA distinguishes between two types of stablecoins: e-money tokens (EMTs) and asset-referenced tokens (ARTs). EMTs are crypto-assets designed to maintain a stable value by referencing a single official currency (eg, US dollar or euro). Meanwhile, an ART is a crypto- asset that is explicitly not an EMT and purports to maintain a stable value by referencing another value or right (eg, gold, securities, other crypto-assets), or a combination thereof, including one or more official currencies. Private v state-issued stablecoins Private stablecoins are market-based instruments issued by regulated or unregulated entities and typically structured as asset-backed or algorithmic crypto-assets intended for payments, settlement, or liquidity management. Their legal treatment is primar - ily determined by financial regulation, including MiCA and related supervisory frameworks. The most prominent examples of private stablecoins are USDC and USDT, which currently dominate the market. In response to the strong reliance on US dol - lar-denominated stablecoins, a consortium of major European banks is planning the launch of a private, MiCA-compliant euro stablecoin as a potential alter - native in 2026. In addition, the digital euro is envis - aged for 2029 as a public alternative. This initiative results from concerns that a significant shift of bank deposits into privately issued stablecoins could affect monetary sovereignty and financial stability. The digi - tal euro is therefore designed as legal tender, pegged 1:1 to the euro (par value) and directly backed by the European Central Bank. In addition to the EU, member states may also issue stablecoins, depending on their design. Where struc -
Introduction – The Overarching Theme Stablecoins on the rise – European regulation under MiCA Stablecoins are becoming increasingly relevant within the global financial system. The EU anticipated this trend early on and introduced the Markets in Crypto- Assets Regulation (MiCA) as a framework that pro - vides clear regulatory requirements for stablecoin issuers and providers of related services. MiCA harmonises the crypto-industry across all EU member states. Fully applicable since 30 December 2024, the regulation provides the regulatory frame - work within which all recent developments in Austria’s crypto-sector must be assessed: • Stablecoins are designed to maintain a stable value relative to traditional currencies and are primar - ily used for payments and as a store of value, in particular dual regulation under MiCA and PSD2 without clear provisions, resolving conflicts (see “Regulatory Treatment of Stablecoins” below). • Relevant for both the traditional and new market players is the distinction between crypto-assets falling under MiCA or MiFID II. European guidelines are clarifying the classification of crypto-assets as financial instruments, reducing any remaining grey areas (see “Between MiCA and MiFID II – Where Do Crypto-Assets Belong?” below). • An increasing number of international companies are choosing Austria to obtain a crypto-asset ser - vice provider (CASP) and/or electronic money insti - tution (EMI) licence. The reverse solicitation regime under MiCA is strict and third-country companies have no other option than to establish themselves in an EU country and passport their services into the other member states (see “How Third-Country CASPs Prepare for MiCA – Reverse Solicitation Adieu” below). • One factor that makes Austria particularly attractive is the Austrian Financial Market Authority (FMA). The authority prepared early for its role under MiCA and can offer potential applicants legal certainty and clarity (see “The Austrian FMA – A Key Player in the EU Crypto-Asset Landscape” below).
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