European central banks want to replace MiCA’s mandatory 30% to 60% bank-deposit floor with one-day and five-day liquidity tests as part of the regulation’s review. This change would reduce direct contagion risk between stablecoins and the banking system but would shift some stress toward sovereign debt and funding markets. In March 2023, USDC’s market capitalization fell 26% over a month due to Circle’s exposure to Silicon Valley Bank, illustrating the transmission mechanism. The ESCB proposal would allow issuers to hold more short-term securities and reverse repos instead of mandatory bank deposits. Euro-denominated stablecoins had a market capitalization of approximately 450 million euros in January 2026, compared with roughly 300 billion dollars for dollar-denominated tokens.
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