The European Union's banking watchdog has called on stablecoin issuers to comply with voluntary 'guiding principles' on managing risks and protecting consumers ahead of mandatory rules that will come into force in June 2024. The EU's Markets in Crypto Assets Regulation (MiCAR) was approved in April and is the world's first comprehensive set of rules for trading cryptoassets and issuing stablecoins.

The European Banking Authority (EBA) has published its first batch of measures to flesh out MiCAR requirements, including a permanent right of redemption and rules for handling complaints. The EBA expects a flurry of stablecoin issuance over the coming months and is encouraging firms to use its guiding principles on good governance and risk management ahead of the mandatory rules.