The European Central Bank warns of the risks of cross-border regulatory arbitrage with stablecoins, calling for a unified regulatory framework on a global scale.

PANews, November 24th news, the financial stability review preview released by the European Central Bank today (the formal report will be published on Wednesday) shows that by November 2025, the total market capitalization of stablecoins will exceed $280 billion, accounting for about 8% of the entire crypto market. Among them, USDT and USDC together account for nearly 90%, with reserve assets reaching the scale of the top 20 money market funds in the world. The report from the European Central Bank indicates that if stablecoins are widely adopted, it may lead households to convert some of their bank deposits into stablecoin holdings, weakening the retail funding sources of banks and increasing financing volatility. Although MiCAR has prohibited European issuers from paying interest to curb such transfers, banks are still calling for similar restrictions to be implemented in the United States. Furthermore, the rapid growth of stablecoins and their association with the banking system may also trigger a concentration of fund withdrawals during a crisis. The report emphasizes the risks of a cross-border “multi-issuer mechanism” and warns that EU issuers may struggle to meet global redemption requests, calling for pre-access additional safeguards and promoting global regulatory alignment.