Opinion RTS to further specify the liquidity requirements of the reserve of assets

General Information

This document is an opinion of the European Banking Authority (EBA) dated 9 October 2025, addressed to the European Commission. It concerns the final draft regulatory technical standards (RTS) aimed at specifying liquidity requirements for asset reserves of asset-referenced token (ART) issuers and certain e-money tokens, pursuant to Article 36(4) of Regulation (EU) 2023/1114 (MiCA). The scope covers liquidity requirements, reserve management, asset maturity thresholds, deposit diversification, and overcollateralization, for ART and e-money token issuers, distinguishing between significant and non-significant tokens. The document is based on public consultations conducted in 2023-2024 and fits within the European regulatory framework including MiCA, the LCR Regulation, and Basel standards.

Executive Summary

This report expresses the EBA's opinion on the amendments proposed by the European Commission to the regulatory technical standards (RTS) concerning liquidity requirements for asset reserves of asset-referenced token (ART) and e-money issuers. The EBA considers that the substantial amendments proposed by the Commission, notably the authorization to invest reserves in non-highly liquid financial instruments such as commodities or crypto-assets, are incompatible with MiCA and introduce significant liquidity risks. In particular, the removal of calibrated liquidity thresholds at 1 and 5 days in favor of a simple minimum threshold of highly liquid financial instruments (HLFI) is deemed insufficient to cover liquidity needs in case of massive withdrawals. The EBA stresses that reserves must remain composed mainly of assets immediately monetizable without significant loss, in accordance with Articles 36(1)(b) and 38(1) of MiCA, and that investment in non-HLFI assets must be excluded except in cases of subscription and redemption in kind. The EBA accepts non-substantial amendments aiming to clarify and harmonize the text. It proposes amendments to ensure regulatory consistency, legal certainty, and financial stability, notably by reaffirming initial liquidity requirements. In conclusion, the EBA submits to the Commission an amended version of the RTS, rejecting amendments that would weaken the prudence of asset reserves and advocating a strict framework for reserve management to ensure immediate and reliable convertibility of tokens in stress scenarios.

Context and Objectives

The document responds to the regulatory obligation under Article 36(4) of the MiCA Regulation, which entrusts the European Commission with defining precise technical requirements on the liquidity of asset reserves of asset-referenced token issuers. The EBA submitted a draft technical standard (RTS) in June 2024, followed by a public consultation. The Commission proposed substantial amendments to this draft in August 2025, notably on reserve composition and liquidity thresholds. The EBA was requested to give its opinion on these amendments. The main issue is to ensure that asset reserves enable issuers to satisfy token redemption requests at any time, including under stress, while ensuring consistency with the European prudential framework and financial stability. The document aims to assess the compatibility of the proposed amendments with MiCA, legal certainty, proportionality, and regulatory harmonization, considering liquidity risks and eligible assets.

Summary of Key Points by Theme

1. Liquidity requirements and reserve composition:

- The EBA insists on maintaining calibrated liquidity thresholds at 1 day (20% non-significant, 40% significant) and 5 days (30% non-significant, 60% significant) for ARTs not referencing only official currencies, opposing the Commission's proposal which reduces these requirements to a minimal threshold of 10-20% highly liquid financial instruments (HLFI) without maturity distinction (p. 2-4).

- The EBA emphasizes that removing liquidity buckets prevents adequate coverage of liquidity needs in case of massive and synchronous withdrawals, which is crucial for stability (p. 2-3).

2. Investment in non-HLFI assets (commodities, crypto-assets):

- The Commission proposes authorizing reserve investment in assets referenced by the token, including non-HLFI assets, which the EBA deems incompatible with MiCA (Articles 36(1)(b) and 38(1)) and prudential standards (p. 2-5).

- The EBA recalls that non-HLFI assets are not recognized as liquid under the LCR Regulation nor Basel standards, exposing reserves to liquidity and volatility risks during stress (p. 3-4).

- The EBA proposes limiting inclusion of non-HLFI assets to subscription and redemption in kind cases, excluding any active investment of monetary funds in these assets (p. 4-5).

3. Regulatory consistency and arbitrage:

- The EBA highlights inconsistency between the Commission’s proposal and the banking prudential framework, where banks cannot consider commodities or crypto-assets as liquid assets for liquidity requirements (p. 4).

- This inconsistency could lead to regulatory arbitrage and weaken European harmonization (p. 4).

4. Diversification, concentration, and deposit management:

- The RTS provide deposit concentration limits per banking institution, differentiated by bank size and systemic importance (25%, 15%, 5% of total reserves) and a cap of 1.5% of the bank’s total assets (p. 13-14).

- The EBA adjusted diversification and credit quality requirements of counterparties to consider reserve size and nature (p. 7).

5. Overcollateralization and gap management:

- A minimum overcollateralization is imposed, calculated over a 5-year period, to cover volatility of referenced assets and ensure reserve value is equal or superior to token value (p. 14).

6. Procedures in case of non-compliance:

- Issuers must submit a restoration plan within 5 days in case of non-compliance or risk thereof, without prejudice to supervisory authorities’ powers (p. 14-15).

7. Non-substantial amendments:

- The EBA accepts editorial amendments proposed by the Commission aiming to clarify the text, harmonize terminology, and improve readability without changing policy (p. 2, 5-6).

Main Findings and Lessons Learned

- Established facts: Asset reserves of ART issuers must be composed mainly of highly liquid financial instruments with calibrated maturities at 1 and 5 days to cover liquidity needs in case of massive withdrawals (p. 2-3).

- Assumptions: The EBA assumes withdrawals can be synchronous and significant, and that non-HLFI assets are not immediately monetizable without significant loss under stress (p. 3-4).

- Interpretations: The EBA interprets the Commission’s proposed amendments as implicitly authorizing active investment of reserves in non-HLFI assets, which is incompatible with MiCA and prudential principles (p. 3-5).

- Uncertainties: The Commission’s proposal introduces legal uncertainty on the nature of eligible assets in reserves, notably regarding the term "include" in the text (p. 4).

- The EBA concludes that the substantial amendments would weaken legal certainty, financial stability, and regulatory consistency, and recommends maintaining the initial strict requirements.

Conclusions and Recommendations

The EBA rejects the substantial amendments proposed by the Commission that would allow investment of asset reserves in non-HLFI assets such as commodities or crypto-assets, due to the liquidity and volatility risks they introduce and their incompatibility with MiCA and the European prudential framework. It recommends maintaining the initial calibrated liquidity requirements at 1 and 5 days, ensuring reserves are composed of assets immediately monetizable without significant loss. The EBA proposes limiting the presence of non-HLFI assets to subscription and redemption in kind cases, excluding any conversion of monetary funds into these assets. It accepts non-substantial amendments aiming to clarify and harmonize the text. Finally, the EBA submits to the Commission an amended version of the RTS, ensuring regulatory consistency, legal certainty, and financial stability, and stresses the importance of a strict prudential framework for managing asset reserves of token issuers.