The European Securities and Markets Authority (ESMA) has set out six demands aimed at strengthening the supervision of stablecoins under the Markets in Crypto-Assets Regulation (MiCA), according to a policy commentary published by crypto payment platform OneSafe.

The six demands form part of ESMA's ongoing effort to close supervisory gaps that have emerged since MiCA's stablecoin provisions took full effect across the European Union in 2024. The regulation, which governs asset-referenced tokens (ARTs) and e-money tokens (EMTs), assigns day-to-day supervision of smaller stablecoin issuers to national competent authorities, while significant tokens fall under the direct oversight of the European Banking Authority (EBA).

ESMA's intervention reflects a broader concern among EU regulators that inconsistent application of MiCA across member states could create loopholes for issuers seeking the most permissive jurisdiction. The watchdog has repeatedly urged national authorities to coordinate supervision, share data on issuers' reserve holdings and redemption practices, and act quickly against tokens that fail to meet the regulation's reserve, disclosure and redemption requirements.

MiCA imposes strict operational conditions on stablecoin issuers operating in the EU. Issuers of EMTs must hold reserves in low-risk assets, honor redemption requests at par value, and in most cases operate as authorized credit or electronic money institutions. Tokens designated as "significant" — a threshold tied to user counts, transaction volumes and reserve value — face additional capital, liquidity and governance requirements administered by the EBA.

The regulatory landscape has already reshaped the European stablecoin market. Several major issuers have restricted EU users or restructured token offerings to comply with the framework, while euro-denominated stablecoins have attracted renewed issuer interest under the new authorization regime. Industry participants, including custody and payment providers such as OneSafe, now face compliance decisions on which tokens they can support for EU clients.

For stablecoin issuers, ESMA's demands signal that the era of light-touch supervision in Europe has ended. Firms that cannot demonstrate full reserve backing, reliable redemption at par and transparent reporting risk enforcement action from national authorities, up to withdrawal of authorization and cessation of activity in the bloc.

For service providers and corporate users of stablecoins, the practical consequence is a narrowing set of compliant tokens for EU-related flows. Payment platforms and exchanges must verify that each token they list for European customers carries the appropriate MiCA authorization, and they must monitor designation decisions that can change a token's supervisory status as it grows.

EU institutions are expected to continue tightening implementation over the coming cycle. The European Commission has signaled a review of MiCA's functioning, and both ESMA and the EBA have standing mandates to issue further technical standards on reserve management, redemption handling and stress testing. Issuers and service providers should expect additional supervisory guidance and potential enforcement precedents as national authorities apply the six demands in practice.